Introduction to Foreign Exchange

Overview:

This course focuses on spot foreign exchange and covers the fundamental knowledge you need to know about the FX markets. You will learn about currency conventions, the trade mechanics of FX, how to quote bid/offer rates and calculate cross rates, and various strategies and risks associated with trading FX. At the end of this course, you will have access to supplemental exercises and questions to apply what you have learned in the course.

Course Content:

In this course, you will gain knowledge about the following topics:

• Currency Conventions
• Currency Priorities
• Different Groups of FX Currencies
• Significant Figures
• Market Quotes
• Direct vs. Indirect Quotes
• Settlement
• Trade Mechanics
• Foreign Exchange Cash Flows 
• Foreign Exchange Quote - Example
• Hitting the Correct Side - Question & Answer
• Quotation Types
• Price Holding
• Market Maker Obligations
• Cross Rates
• Refinitiv Workspace Cross Rates
• Triangular Arbitrage
• Bid Offer Spread
• Triangular Arbitrage
• Trading Spot FX
• Midway Video
• Trading Strategies
• Market Risks
• Open vs. Square Position
• Net Open Position
• Hard vs. Soft Limit 
• Position Limits
• Loss Limits
• Average Rate and Profit and Loss
• Mark to Market
• Event Risk Foreign Exchange Orders
• Order Types - Take Profit and Stop-Loss
• Order Types - One-Cancels-the-Other (OCO)
• Trade Blotter Walkthrough

Learning Objectives:

Upon completing this course, you will be able to:

• Learn how to identify foreign exchange currency codes and currency pair ordering.
• Identify and understand the difference between direct and indirect quotes
• Calculate foreign exchange cross rates
• Understand the foreign exchange settlement process
• Understand the various risks associated with the foreign exchange market
• Employ various market strategies to enhance market returns and reduce market risks.

Who Will Benefit: 

Anyone who would like to build up their understanding of capital markets, with a focus on the foreign exchange markets. This course is designed to equip anyone who desires to begin a career in fixed income, equity, sales, and trading, or other areas of finance with the fundamental knowledge of foreign exchange.