How To Earn Extra Income Without A Part Time Job

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Have you been looking for a way to earn some part time income in the evening. This is not income from some sales job, driving your car delivering pizzas, or working at a job. To make this money, the only thing you need is access to the internet and a personal computer . Actually, this is income you can make while watching TV at night.

Most of us know about day trading, buying and selling equities in the same trading day. So what is Nite Trading? The Market is already closed.

Surf up nite trading on the internet and all that you find is a little information regarding a company called Knight Trading Group.

What then is nite trading?

Nite trading is about trading currencies, and recently, trading the Futures Market with the Futures of the Forex.

Trading currencies is a never ending cash market in which traders trade small fluctuations in foreign rates on world-wide currencies. Currency trading happens through a world-wide system of international brokers, corporations, banking institutions, and smaller players investing one currency vs another. Trading currencies has no physical exchange like financial equity markets(NYSE, NASDAQ). Trading takes place nearly 24 hours every day. It is very liquid with thousands of contracts traded daily. There are always traders eager to trade currencies.

Until recently, most individual investors who day trade foreign money primarily traded Forex. For bigger investors, such as institutions and hedge funds, this makes logical sense, given that the Forex has a daily volume of $1.9 trillion. But for smaller investors attempting to trade 5-10 contracts instead of 2-400, the Forex Market may not be advisable. There is a market tailored to the needs of individual traders…the Futures of the Forex.

From the time that they first began trading in 1972 inside the Chicago Mercantile Exchange (CME), currency futures have undergone important changes. At the time these contracts were created, 99% of the trades were generated by Market pros from the CME. The Futures Market was influenced by trained veterans screaming in the open outcry pits. But with the arrival of trading online, the Futures of the Forex was no longer limited to a handful of pit traders.

The number of Forex Futures traders is increasing daily, especially since the new rules proposed for the Forex Market in January 2010 by the Commodity Futures Trading Commission (CFTC).

Given the new rules, Forex brokers and traders going forward may only invest with a maximum 1:10 leverage. This means they have to keep at a minimum, 10% of the transaction as collateral (margin). Before, leverage was 1:100. Procedure changes such as these notably reduce trade size that investors can enter. Reducing leverage means fewer profits for larger investors and hedge funds. For US traders, brokerages will see their profit margins reduced as smaller trade size equals fewer commissions from spread. For example , currency trading with 1:100 leverage, $100,000 USD for 2 pips = $20 commission for the brokerage. Enter 1:10 leverage. That investment is $10,000 (1:10), and that’s only $2 for the brokerage.

The new Forex rules may also stop the Market’s shifting to ECN execution. Forex clearing firms can’t handle small trades and generally won’t process trades of fewer than 100,000 USD. This may result in US brokers most likely having to do their own clearing for individual investors, serving as their own Market Maker, making profits on bid/ask spreads. For individual investors, this would be a deal killer.

This is not the first time the CFTC has proposed significant changes to Forex trading. Each time they propose new rules, they add another stop to the US Forex Market, forcing more and more Forex business offshore. As a result, Forex trading is better done using offshore broker accounts that are not restricted by the CFTC rule rules. Foreign accounts work for larger investors. But for smaller investors who may need quick access to their money domestically,trading Forex is becoming more and more difficult.

Enter the Futures of the Forex. Then what is the benefit to investors trading Currency Futures instead of Spot Forex?

With trading Futures currencies, there are smaller spreads between the bid (what you can buy the contract for) and the ask (what you can sell it for), just 1 tick, or 1 price movement. When the new CFTC change goes through and Clearing firms refuse to clear smaller investor trades, domestic brokers will be serving as the Clearing firm and wind up being the Market Maker . The spread between the bid and ask in Forex positions may become significant, certainly more than 1 tick. Brokerages could be making money on the spread alone, at the expense of the smaller investors profit.

With Forex Futures, there are no interest charges or rollover fees daily. Transaction costs are round turn, not both in and out. In reality, brokerage commissions + exchange + regulatory + transaction charges are fewer than the Forex PIP spread.

Take a look at an example of trading 1 Forex USD/EUR contract instead of 1 Forex Futures contract, with a contract size of $100,000 worth of euros. For a round turn, futures commission and related fees are $5/contract, the average fee by many brokerage firms . A Forex trader with a 100,000 full-lot-size contract pays 2 PIPs for each transaction, or $20 per round turn trade.

There is another difference as well. To profit from a Forex trade, the currency price must move beyond the number of PIPs that your brokerage takes upfront . If the broker takes 2 PIPs upfront, then the price must move at least 3 PIPs so that the trade can be profitable to the investor. With Futures, the investor makes money even if the price only moves 1 tick (1 price movement). The profit may be smaller on the first tick as a result of commissions, but at least the investor makes something . With Forex, the initial price movements entirely belong to the broker. Forex traders always say… Forex has no commission. They ignore the fact that the broker takes the first PIPs in compensation.

It is a given that the Forex market has a lot more currency pairs to trade than Forex Futures. But the major currency pairs can still be traded in the Futures Market, including: 6A (Australian Dollar), 6B (British Pound), 6C (Canadian Dollar), 6E (Euro), 6J (Japanese Yen). Before deciding to trade Forex currencies, individual traders should check out trading currency Futures.

Currency trading is hot for nite trading no matter where in the world a traders are living. With the various time zones worldwide, when Australian (6A) and Japanese (6J) traders are day trading, Americans can be nite trading in the US (7:30-1:30 EST). At 3:00am EST, the Europeans begin trading (6E) Conversely, when Americans are day trading, Australians and Asians can enjoy nite trading the very same instruments.

Barbara Cohen has been a professional day trader for over 10 years. She has trained hundreds of day traders to trade the Futures Market with Shadowtraders trading system. As the CIO, Barbara moderates Shadowtraders daily online trading chatroom. Before you purchase any trading seminar, make sure you attend Shadowtraders Monday Night Webinar

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