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Another carry trade question ...

  • #1
  • First Post: Oct 6, 2009 7:22pm Oct 6, 2009 7:22pm
Hello all
Another rookie looking for some help here! I would like to ask about the carry trade. I tried doing a search, but there are so many threads it was difficult to find the answer I really wanted, so apologies for starting another.

Basically two questions:

1) Which pair is the best for the carry trade (I mean in the interest recieved daily)?

2) Whether you trade a micro-account ($1000) or a standard account ($10,000), does the size of the account you trade make a difference?

Thanks in advance
  • #2
  • Oct 7, 2009 1:15am Oct 7, 2009 1:15am
1) I wouldn't look for the best interest but for the most stable economy. In that case I'd choose AUD/JPY because the AUD has rocksolid fundamentals and they just started their rate hike circle again. If you want it more volatile you can chose any TRY pair or BRL or something similar.

2) For carry trading you have to trade with low leverage usually. I wouldn't go above 1:1 in the beginning.
  • #3
  • Oct 7, 2009 4:17am Oct 7, 2009 4:17am
Quoting Xaron
1) I wouldn't look for the best interest but for the most stable economy. In that case I'd choose AUD/JPY because the AUD has rocksolid fundamentals and they just started their rate hike circle again. If you want it more volatile you can chose any TRY pair or BRL or something similar.

2) For carry trading you have to trade with low leverage usually. I wouldn't go above 1:1 in the beginning.
Thanks for the answer Xaron, I really do appreciate it But I spent the afternoon here at work reading all the posts I could about this topic, and finally decided it might be a little early in my FX career to delve into the carry trade yet. I think I might need a little more experience and there is probably a lot more I need to study first.
  • #4
  • Oct 7, 2009 4:34am Oct 7, 2009 4:34am
I'd recommend Oanda for carry trading as they have really nice swaps and the possibility to trade as low as one single unit. There are some carry trade threads over there at Oanda's forums but carry trading itself is not that easy especially during meltdowns like last year. Right now it could be a really good time to start again...
  • #5
  • Oct 7, 2009 5:51am Oct 7, 2009 5:51am
betting, you must remember that if you do carry trade, because it is a margin account with leverage, you may not survive adverse moves even with the interest moved... hence not feasible ..

welcome to forex!

if you wish, you can read some of my beginner articles at my website..


www.thegeekknows.com
  • #6
  • Oct 7, 2009 5:53am Oct 7, 2009 5:53am
Quoting trading801
betting, you must remember that if you do carry trade, because it is a margin account with leverage, you may not survive adverse moves even with the interest moved... hence not feasible ..
Mhh... what? Because the broker offers leverage that doesn't mean that he actually has to use this leverage. He can (and should) trade well below 1:1.
  • #7
  • Oct 7, 2009 6:10am Oct 7, 2009 6:10am
Quoting Xaron
Mhh... what? Because the broker offers leverage that doesn't mean that he actually has to use this leverage. He can (and should) trade well below 1:1.

sorry allow me to clarify ... i meant if the broker do not offer zero leverage..
  • #8
  • Oct 7, 2009 6:31am Oct 7, 2009 6:31am
Quoting trading801
sorry allow me to clarify ... i meant if the broker do not offer zero leverage..
Ah ok. But which broker should that be? I haven't seen a single one actually. Or do you mean if you have a $100 account but can only trade 0.1 lots min?
  • #9
  • Oct 7, 2009 7:06am Oct 7, 2009 7:06am
yes ! thats what i mean .. sorry for being not specific .. i was worried that perhaps the threadstarter is on the $100 micro kind of acct.
  • #10
  • Last Post: Oct 7, 2009 8:04am Oct 7, 2009 8:04am
Thanks again for the answers guys, everything is welcome I've got considerably more than $100!!

Actually I've been trading live for about 6 months using a system I found on the net, made quite a few pips and a few dollars and have protected it all as well (so far).

But recently I've been wanting to make my own system and include stuff I would like to do with forex, carry being a part of it. I'll read your articles trading801 and see what else I can learn, thanks again
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