Standard Bank is a leading provider of online Forex trading for investors worldwide. This is a result of competitive pricing, good liquidity and a range of more than 160+ different forex crosses.
Why trade Forex
Foreign exchange is the most actively traded and liquid financial market in the world. It offers everyday traders significant potential to increase their personal wealth. The market, which is estimated to trade around USD 4 trillion on a daily basis, trades around the clock and can be accessed at any time, day or night.
What you need to know when trading FOREX online
Trade Currency and Price Currency
Simply put, a forex trade entails the buying of one currency against the selling of another, and vice versa. The advantage of trading the forex market is that there are only a few major currencies to follow compared to the thousands of stocks in the equity markets. Currencies trade in pairs, like the Euro-US Dollar (EUR/USD) or US Dollar-Japanese Yen (USD/JPY). Most traders tend to focus on the biggest, most liquid currency pairs, also known as "The Majors". They include currencies such as the US Dollar, Japanese Yen, Euro, British Pound, Swiss Franc, Canadian Dollar and Australian Dollar.
Forex Margin Trading
Margin trading allows investors to buy and sell assets that have a greater value than the capital in their account. Forex trading is typically executed on margin accounts. The industry practice is to trade on relatively small margin amounts since currency exchange rate fluctuations tend to be less than one or two percent on any given day.
Margin trading involves a large amount of risk. Since a position is being held that exceeds the actual value of the account, a trader could incur substantial losses if the market moves against his position. Thus, margin trading requires close monitoring of margin utilisation, i.e. the amount of collateral being used to hold margined positions.
If margin utilisation exceeds collateral available for margin trading, positions must be closed, reduced, or additional funds must be posted immediately to cover the position.
Spot Precious Metals
Webtrader offers an impressive 12 FX crosses in Precious Metals. Gold, Silver, Platinum and Palladium are available as spot traded commodities, ideal for both long and short-term speculative trading.
Spot Gold and Silver can be traded versus US Dollar, Euro, Japanese Yen, Australian Dollar and the Hong Kong Dollar. Platinum and Palladium both trade against the US Dollar.
Consider the power of precious metals trading to:
- Diversify your portfolio
- Trade long or short on live streaming prices
- Leverage your investment
- Trade from 1 ounce and up with all advanced order types available
To learn more about trading Spot Precious Metals, visit our Knowledge Centre
FX Spot Trading Conditions
Fixed Bid/Ask spreads on majors
Webtrader quotes prices based upon a fixed spread, which is defined as the spread between the Bid and the Offer. Spreads depend on the currency pair and the desired trade amount.
See full list of FX spreads under FX Prices.
Under abnormal/ illiquid market conditions such as just before and just after releases of key economic figures, during periods of volatile market conditions or at illiquid times, e.g. market opening, early Asian time zone, late New York time zone, during value date change, spreads may be wider than the announced fixed spreads.
FX Product Coverage
Webtrader offers you extensive flexibility trading Forex Spot online. With us you can:
- Leverage your FX spot positions.
- Trade on live, streaming, executable prices.
- Benefit from trading with fixed Bid/Ask spreads under normal market conditions.
- Have liquidity aggregated from Top Tier 1 providers
FX SPOT Spreads
Click here to view the full list of trading spreads and margin requirements on all 160+ FX crosses.
Tickets fee on Small trades
For FX trades below the ‘ticket fee threshold’, a small fee of USD 10 is added to the trade to cover administration costs. Please refer to our full list of FX spreads for further details
Trade Ticket Colours
The Trade Tickets in Webtrader's Trading Platforms are colour-coded to indicate the availability of the price quoted to you:
- Green - live streaming prices are available for auto execution
- Yellow - prices are available on an RFQ (request for quote) basis. A dealer will manually quote the client, which makes the prices green and therefore tradable.
- Purple - the market is closed (trading and RFQ not available).
Trade on Quotes
The primary method used to execute a trade on Webtrader is to 'trade on quote'.
When you click on a 'green' tradable price, you will generally be executed on that particular price, or in a rare event, it may happen that you will not executed at all.
If the price moves too much - either up or down - from the time you place the trade, to the time when we receive you request, the trade request might be rejected. This applies to the scenario where the price has moved significantly against the client as well as movements significantly in favor of the client.
Trading FX with Webtrader on 'green' tradable prices gives transparent pricing as you know upfront which price you will be filled at. That is the price that will be displayed for you on the FX Trade Ticket prior to opening a trade.
Various order types can be used to enter or exit the market at certain price levels. See Order Execution at the bottom of this page.
Trading on Bands
Different spreads are provided for different bands. The spread is tightest in the smallest band. Trade amounts above the largest bands prices, will be quoted manually on a request for quote basis (RFQ).
Deep liquidity removes the delay and the need for manual intervention in the major and most commonly traded currency pairs.
Each time you trade, a reload period begins. If you continue to make consecutive trades in the same currency pair within the reload period, the spreads may widen beyond the fixed spread as your dedicated liquidity is reduced.
After twenty (20) seconds with no new trading activity in the given currency pair, the reload period elapses, and full, dedicated liquidity and normal spreads are available again.
All open FX positions held overnight are subject to a debit or credit interest rate revaluation to reflect the position being rolled over to a new Value Date. The operation known as the Tom/Next Rollover is applied to spot positions held at 17:00 Eastern Standard Time (New York time) on any given trading day.
The ‘rollover’ is made up of two components, namely the tom/next swap points and financing of unrealized profits or losses. The accumulated combined rollover credit or debit is added/deducted from the previous opening price of the position.
Minimum trade size
There is a minimum trade size that applies to FX Spot trading with Standard Bank. For most currency pairs it is 5,000 units of the base currency, however variations occur. Precious Metals can be traded as low as 1 ounce. Trades cannot be executed below the Minimum Trade Sizes (except for closing an open position below the minimum trade size). Full details can be found under ‘Commissions, Charges and Margin Schedule'
Forex Trading hours
Webtrader is open for FX Spot Trading from Monday morning 5:00 local Sydney time to Friday afternoon 17:00 Eastern Standard Time (New York time).
Some currency crosses, however, have special trading hours as seen in the table below.
|Currency Cross||Trading Hours|
|USDRUB, EURRUB||07:00 to 16:00 CET|
|USDRON, EURRON||08:15 to 17:00 CET|
|USDJOD||08:00 to 16:00 CET|
|USDILS, GBPILS||07:00 to 17:00 CET|
|USDOMR, USDKWD, USDSAR, USDAED, USDBHD||07:00 to 15:00 CET|
|EURLTL, USDLTL||07:00 to 14:00 CET|
|USDQAR||04:00 to 15:00 CET|
|Precious Metals (XAU, XAG, XPD, XPT)||18:00 to 17:15 EST (New York time)|
Most FX Spot positions have a value date of T+2. This means they settle two business days after the day of execution. There are some exceptions to this; USDTRY, USDRUB and USDCAD, which all have a value date of T+1.
With Webtrader, FX Spot positions do not settle. Instead, open positions held at the end of a trading day are rolled over to the new spot value date as described under 'Tom/Next rollover'.
When netting open FX positions, Webtrader uses FIFO rules, which means the first position you open is the first position to be closed.
You are trading EURUSD opening the following positions:
- Buy 1M EURUSD
- Buy 1M EURUSD
- Sell 1M EURUSD
- Sell 2M EURUSD
Total Sell 1M EURUSD
The first long position 1) will net out with the first short position 3), the second long position 2) will net out with half of the second short position 4), leaving only one short position of 1M EURUSD at the end of the day.
Trading with Leverage
With Webtrader you are able to leverage your FX positions.
Margin requirements may be changed without prior notice. Standard Bank reserves the right to increase margin requirements for large position sizes, including client portfolios considered to be of very high risk.
You must maintain the required margin collateral as listed in the Account Summary on the Trading Platforms at all times.
If at any time while an FX position is open, and the margin required to maintain that position exceeds the funds available for margin trading on the account, you are in breach of your contract and you need to meet the margin requirements again. This can be done by either:
- reducing the size of the open margin positions and / or
- providing more funds (margin collateral) to the trading account.
When the required margin exceeds your margin collateral you are at risk of a stop-out where Standard Bank may close your margin positions on your behalf.
Margin trading carries a high level of risk to your capital with the possibility of losing more than your initial investment and may not be suitable for all investors.
Ensure you fully understand the risks involved and seek independent advice if necessary.
Supported Order types
Most market standard order types are available, i.e. Market, Limit and Stops including 'No Slip' Stop, Stop If Bid, Stop if Offered with Trailing Stop support.
Trailing Stops, where the Stop level moves in line with the market price, are supported for all three Stop order types.
All Stop and Limit Orders can be placed as either:
Day Order – automatically expires at the end of the given business day (i.e. at 17:00 EST - Eastern Standard Time).
Good till Cancelled (GTC) – order stays open until cancelled or when filled.
One-Cancels-Other (O.C.O.) Order - One-Cancels-Other Orders really consist of two orders. If either of the orders is executed because its market conditions have been met, the related order is automatically cancelled.
A Market Order, for a currency pair and amount within the streaming liquidity, is treated in the same way as if you are requesting to trade FX spot directly from a Trading Module (i.e. 'Trade on Quote') with the exception that a Market Order will never in normal market conditions be rejected (but therefore can result in a slippage).
Market Orders are always filled at the current available price for the given amount.
Limit Orders are used to take profit or to enter the market at a certain price level:
Limit Orders to buy can only be placed below the current market price.
Limit Orders to sell can only be placed above the current market price.
Aggressive Limits - Standard Bank allows for the placement of slightly in the money limits (for clients to use as a limited Market Order).
Limit Orders are always filled at the limit price, as well as when market gaps beyond the limit price. Never worse, never better.
An exception to the rule is in case of a large price gap during a closed market. Thus, during the period of the market opening (Monday, 5:00am Sydney time) when the liquidity is thin, the relevent third party improves Limit Order fills when possible depending on the amount of total Orders that are triggered and the liquidity available in the market.
Stop Orders are typically used to limit losses at a certain price level. Stop Orders are typically filled at the stop level selected by the client, except for 'Buy Stop if Bid' and 'Sell Stop if Offered' where the fill is done on the opposite side of the spread from the stop level. These Orders are typically filled at the stop level adjusted for the spread at the time.
Stop Orders are filled on transparent prices with +99% of Stop Orders in for example EURUSD filled at the expected level set by the client.
A Trailing Stop Order is a stop order where the stop price trails the spot price. As the market rises (for long positions) the stop price rises according to the proportion you set, but if the market price falls, the stop price remains unchanged. This type of stop order helps you to set a limit on the maximum possible loss without limiting the possible gain on a position. It also reduces the need to constantly monitor the market prices of open positions.
Let's say that you expect the price of an instrument to rise and reach at least 1.5710 by the end of the day. You open a long position at 1.5680. To limit any potential loss, you place a trailing stop order at 1.5670 with a distance to market of 10 and a trailing step of 5. During the day the market rises as predicted and the trailing stop follows. When the price suddenly drops to 1.5700, the trailing stop price has reached 1.5705 and is triggered. You have thereby not only protected our initial investment, but you have also managed to keep a good proportion of the profits.
When setting the stop price you should be careful not to set it too close to the current market price, especially in a volatile market, as the stop price might be hit before the price starts to go up/down as you expect. On the other hand you should carefully consider how much you can afford to lose, if your prediction does not hold.
Stop if Bid / Stop if Offered
Stop if Bid Orders are typically used to limit losses on short positions.
Stop if Offered Orders are typically used to limit losses on long positions. This is to prevent Orders from being triggered just because of a temporary large spread (maybe for a split of a second).
Standard Bank therefore encourages you to only use Stop if Bid for Buy Orders and Stop if Offered for Sell Orders.
To help you select the right Stop order type, the 'FX Order' Ticket on the platforms automatically defaults to Stop if Bid for Buy and Stop if Offered for Sell Orders unless you actively change it before placing the order.
Stop if Bid Orders to buy are when triggered most often filled at the order level plus the client spread, which means no slippage.
Stop if Offered Orders to sell are when triggered most often filled at the stop order level minus the client spread, which means no slippage.
During volatile markets with price gaps, orders may be slipped to the current market bid price. Stop if Bid Orders to sell are when triggered filled at the client Bid price at the time.
Stop if Offered Orders to buy are when triggered filled at the client Offer price at the time.
The use of Stop-if-Offered Orders to buy or Stop-if-Bid Orders to sell for Forex positions can result in positions being prematurely closed if a market event causes the Bid/Ask spread to widen for a short duration.
Our order management system has certain client protection mechanisms in place that ensures that the vast majority of Orders are filled without any slippage.
Automatic Order fill
The vast majority of FX Orders placed on Webtrader are filled automatically without any manual intervention from our third party broker.
For very large orders, during very volatile market conditions (for example during release of key economic figures) and in certain non-streaming currency pairs, manual review from the relevent third party is performed.
Manual Order fill
Typically, only a very small proportion of orders placed with Standard Bank require manual intervention. These orders are either too large in size for automatic execution for that particular currency pair, in an illiquid currency pair without streaming price or it is such that there are high volatile and/or illiquid market conditions.
During illiquid market conditions there are fewer market participants and thus dealers will need to check the price and also that the desired trade amount is actually available in the market. For some currency pairs, such as USDRUB and USDCZK, all orders are filled manually, regardless of size. This is due to very low trading volumes / liquidity in these pairs.
Partial Order fill
Partial fills of orders are not supported in FX Spot.
For very large orders, the relevant third party broker may manually fill orders partially, and insert a new order for the remaining amount.