Archive for June, 2015

Bforex Website Explains Trading Margins, Leverage on the Forex Market

June 25, 2015

After earning an MBA from the Technological University of Mexico (UNITEC), Pablo Soria de Lachica went on to join the investment and trading industry. Pablo Soria de Lachica currently serves as the director of business development at Bforex, a currency trading firm that helps traders conduct transactions on the foreign exchange (forex) market.

To help new traders begin trading on the forex market, the Bforex website offers a wide range of trading resources, including information on trading margins and leverage. Bforex explains that the trading margin as the disparity between a trader’s collateral capital and the sum allotted for trade. According to Bforex, forex traders are required to maintain a certain level of collateral in order to sustain open positions on the market. The forex market, in contrast to stocks and commodities, does not have margin calls, and all open positions will close automatically if an account drops under the margin requirements.

On its website, Bforex also explores leverage, which enables forex traders to manage a higher amount of currency during a trade than they presently have in their trading account. Bforex emphasizes that the leverage system is a powerful component of forex trading and can help traders yield significant profits.

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China Seeks to Spur Forex Activities with Simplified Regulations

June 15, 2015

As director of business development at Bforex, Pablo Soria de Lachica leads the provision of innovative tools for both novice and experienced investors in the foreign exchange (forex) market. Pablo Soria de Lachica leverages more than 15 years of financial-sector experience and up-to-date knowledge of global currency market developments to oversee all daily activities of the global firm, which has 18 offices around the world, including in Uruguay and Mexico.

In early March 2015, the State Administration of Foreign Exchange (SAFE), China’s foreign exchange regulating body, announced plans to simplify its rules regarding cross-border direct investments in an effort to encourage increased forex investment activities. Effective June 1, 2015, SAFE will no longer require government approval for foreign direct investment (FDI) and outbound direct investment (ODI) registrations. The relaxed regulations will allow cross-border direct investors to open foreign exchange accounts directly after submitting registration documents to qualified banks. Previously, these investors were required to obtain federal approval prior to registering.

Due to the current protracted nature of the administrative approval process, cross-border direct investors run the risk of missing investment opportunities while waiting for government approval. According to experts, such as Wang Yongzhong, a research fellow at the Chinese Academy of Social Sciences Institute of World Economics, China’s newly simplified rules are likely to spur both FDI and ODI.

While these regulatory changes are aimed at spurring investment activities, they also present the need for increased monitoring. Shanghai University of Finance and Economics professor Tan Ruyong notes that in order to prevent inflows of hot money, SAFE should bolster its foreign exchange market supervision efforts, and the regulatory body has stated its intentions to supervise investors’ bank registrations to monitor foreign currency inflow and outflow.