In recent years, foreign exchange trading is a popular investment method in financial investment, because its settlement method is relatively easy, and the income is also high, and it has been loved by many people. But for novices, foreign exchange trading is not that simple, and a lot of foreign exchange knowledge is still relatively vague for novices, especially since the trading volume of foreign exchange transactions is manually measured. We often hear how many hands have been traded and how many hands have been closed when conducting foreign exchange transactions. The hand here is the transaction volume. So, what is the first-hand foreign exchange transaction? What are the first-hand transaction costs and handling fees?
How much is the first lot of foreign exchange transactions?
In the foreign exchange market, there are two statements about traders. The first one represents a standard hand and is very popular. The second hand represents 0.01 standard lot, which is regarded as the smallest unit of foreign exchange transactions. Let us use one hand to explain a standard hand.
The total capital represented by the first-hand foreign exchange transaction is US$100,000. For example, if a trader conducts a second-hand transaction between the United States and Japan, he or she will buy the equivalent of 100,000 U.S. dollars in Japanese yen for the transaction. Of course, in actual trading, traders do not need the real $100,000, leverage will expand their funds.
What are the fees and handling fees for foreign exchange transactions?
The cost and handling fee of foreign exchange transactions mainly include two parts: one is the margin that needs to be paid in foreign exchange transactions, and the other is the spread of foreign exchange transactions.
Foreign exchange margin is a certain margin that investors need to pay when establishing a position. Due to the cost of establishing a position in foreign exchange transactions, the foreign exchange margin will be returned to the trader when the trader closes the position, so this is not a strict cost. But when opening a position, you cannot open a position without deposits.
In the example above, for the first-hand US and Japan, under 400 times leverage, the required margin is 250 USD, and if it is 100 times leverage, it is 1000 USD.
The handling fee for foreign exchange transactions is the spread, which refers to the difference between the buying price and the selling price when opening a position. Spread is the main fee that traders need to pay for the transaction and will not be refunded.
The differences between different foreign exchange platforms are also different, and the handling fees for one-hand foreign exchange transactions are also different, which requires traders to see the differences between their trading platforms.