What is the financial information

What is the financial information

  10:20 p.m.    forex

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Cash flow

Characteristics of financial information.

The characteristics of the financial statements must be based on the characteristics of accounting information in the bulletin A-1 principles generally accepted accounting principles, which are:

Utilidad.- Its informative content must be meaningful, relevant, accurate, comparable and timely.

Confiabilidad.- must be stable (consistent), objective and verifiable.

Provisionalidad.- contains estimates to determine information corresponding to each accounting period.

The essential feature of the financial statements will be to contain the information to reach a judgment. To this it must be characterized by being impartial and objective, in order not to influence the reader to a certain point of view responding to the characteristics of reliability and truthfulness.

Within the context of generally accepted accounting principles of the basic financial statements are historical, that report occurred facts and are part of the framework for the general user can weight the future.

The basic financial statements are:

The balance sheet showing assets, liabilities and stockholders' equity at a certain date.

The income statement showing revenues, costs and expenses resulting gain or loss in the period.

The statement of changes in stockholders' equity, showing changes in the investment of the owners during the period.

The statement of changes in financial position, indicating the resources and obligations of the company in the period were changed.

The notes to the financial statements are an integral part thereof, and aims to complement the states with relevant information.

Limitations on the use of financial statements.

Users of financial information should take into account the following:

Transactions and economic events are quantified by particular rules depending on the personal judgment of who performs them.

Since the financial statements are expressed in currency as their form of measurement should be considered to have a value that changes based on economic events.

The financial statements, especially the balance sheet are not intended to present the value of the business, but to present the value for the business, its resources and quantifiable obligations. The E. F. not quantify other essential elements of the company such as human resources, product, brand, market, etc.

conclusions

The generally accepted accounting principles in bulletin B-1 indicate all that concerns over financial reporting as reflected in the financial statements, the important thing in this information is to guide and basis for decision-making within of the entity. One can say that this information is the compass of a company to decide what measures and actions taken.

It is very important that this information follow accounting principles so that you can be objective because it follows these parameters, the information will be distorted causing a bad decision on users, it should be noted this point that financial information should not be a position or particular point of view, because its function is solely to reflect the financial situation of the company without leaning to any arbitrary conclusion.



Also of note and deepen the limitations of this information because they reflect the financial statements is not the business value this means that only the value of its assets and its obligations is reflected but not leaving aside other resources important in the overall value of a company.

To conclude mention that the criteria used to provide and make financial information should never get out of accounting principles and the notes accompanying the financial statements must have sufficient and relevant information to be noted and reported but should not be excessive information not to cause confusion among users.

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What is the financial information?

What is the financial information?

  10:19 p.m.    forex

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What is the financial information?

Financial information is information that produces essential for the management and development of enterprises accounting and therefore is processed and concentrated for use by management and people working in the company.

The need for this information makes the financial statements occur. The financial information has become an integrated set of financial statements and notes to express what the financial condition, results of operations and changes in financial position of a company.

The importance of financial information to be presented to users serves to formulate its conclusions on the financial performance of the entity. Through this and other evidence the general user can evaluate the future of the business and make economic decisions on it.

Objectives of financial information.

The basic financial statements must meet the objective of reporting on the financial position of the company on a certain date and the results of its operations and changes in its financial position for the accounting period ended on a certain date.


The E. F. are a means of communicating the financial situation and so why not try to convince the reader of a certain point of view or position. The ability of E. F. is to transmit information that meets the user, and since they are different users of this information it should serve to:

Make investment decisions and credit, the main stakeholders of this information are those that can provide financing or granting credit, to know how stable and growth of the company and thus know the performance or return on investment.

Appraise the solvency and liquidity of the company as well as its ability to generate resources, here are the different stakeholders creditors or owners to measure the flow of money and performance.

Evaluate the origin and characteristics of the financial resources of the business and its performance, this area is of general interest to know the use of these resources.

Finally make a judgment of how it has handled the business and evaluate the management of the administration, such as profitability, solvency and growth capacity of the company is managed.

When financial information satisfies the general user is a person with some technical knowledge to form an opinion on:

The level of profitability

Financial position, including its solvency and liquidity

The financial capacity for growth

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How currencies are traded?

How currencies are traded?

  10:36 p.m.    forex

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How a FX trading

Brokers buy and / or sell currencies to make a profit from fluctuating exchange rates of currencies.

 If brokers believe that an X currency will be affected by economic conditions, and it is likely that their value goes down, they will sell the X currency buying another currency and hoping to win in value against the currency X.

After some time and fluctuating exchange rates, brokers buy back the currency X selling currency Y. If the initial speculation was correct, brokers require less of the currency and to buy the currency X.

the difference between the original amount of money X before and after negotiation is regarded as profit.

major pairs
There are six major world currencies that cover most of the transactions in the Forex market.
These are:

US $ US Dollar
EUR Euro Zone
JPY Japanese Yen
GBP British Pound
CHF Swiss Franc
AUD Australian Dollar
US $ is the most common industry standard currency, and is linked to trade in silver and gold. Currently the euro is the second most actively traded currency, surpassing the dollar in 2006, reaching a record in 2007.

Currency Pair
In Forex, the value of a currency is determined by comparison with another; therefore, always a currency pair has two values. The base currency, which is the value to the left, represents the main or accounting currency broker. Quoted currency, the value to the right, is regularly referred to as the "opposite" or "secondary" currency. (Eg .: USD / AUD, USD is the base currency and AUD is the quote currency). Currency pairs determine the amount of the quote currency is needed to buy one unit of the base currency.


Purchase price and sale
The selling price (Bid) represents the price the Forex market is willing to pay for a certain currency pair. This is the price set which brokers sell your base currency.
The purchase price (Ask) represents the price at which the market is willing to sell a currency pair. This is the price set which brokers buy the quote currency.
For example, the USDCHF 1.1650 / 1.653 par, the selling price is 1.1650. This means you can sell one US dollar 1.1650 US $ per CHF. Also, the purchase price is CHF 1.1653. This means you can buy a dollar US $ per CHF 1.1653.
The difference between the purchase price and selling is the buying and selling spread. The buying and selling spread represents the difference between the highest price that buyers are willing to pay to buy a certain currency against the lowest at which sellers are willing to sell the same currency pair price.

Pipos
A "Pip" or point (Point of Interest for Price) represents the smallest fluctuation in price of a currency pair. For most currencies, the exchange rate is expressed to four decimal places. Therefore, 1 pip represents 1 / 10,000 ° or 0.0001 of the opposite currency. The change of 1 pip for the pair GPB / USD to 1.6319 equals 1.6320. The pip value for some types of change, such as USD / JPY, only expressed to two decimal places (ie, 1/100 ° or 0.01). </ O: p>

Calculation of profits and losses
Most trading platforms automatically calculate profits and losses broker for open positions. Thus, runners can track their gains and losses in sync with changing market prices. Understanding how these calculations are performed can be useful for runners.
Examples:
3 lots of EURUSD sold to 1.2175 and 1.2110 purchased:
In this example, the client 65 pips * 3 lots = 195 pips in total profit (as he sold at a higher price than he bought). The pip value for EURUSD is US $ 10, so that the total profit = 195 pips * US $ 10 per pip = US $ 1.950.
2 lots of USDJPY bought and sold 105.60 105.20:
In this example, the client 40 pips * 2 lots = 80 pips in total loss (as he sold at a lower price than he bought). The pip value for USDJPY is 1000 JPY and this equals 1000 / 105.20 (price of USDJPY closing the position) = US $ 9.506 approximately. The total loss of 80 pips * client = US $ 9.506 per pip = US $ 760.46.
2 lots of EURGBP sold to 0.7015 and 0.6940 purchased:
In this example, the client 75 pips * 2 lots = 150 pips in total profit. The pip value for EURGBP is 10 GBP and this equals 10 * 1.8500 (assuming the price of GBPUSD was 1.8500 to close the position) = US $ 18.50. The total profit is 150 pips * US $ 18.50 per pip = US $ 2775.
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Introduction to Foreign Exchange

Introduction to Foreign Exchange

  10:34 p.m.    forex

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Introduction to Foreign Exchange

What is the market changes?

The foreign exchange market (FX or Forex) is one of the largest financial markets in the world and also one of the most liquid. According to the Triennial Central Bank assessment has great authority, drafted by the Bank for International Settlements, Basel, average daily gross earnings for April 2007 exceeded US $ 3.2 trillion, and everything points in the direction that the market continues to expand. The spot market accounts for about a third of the total FX market activity.

The foreign exchange (FX) is easy to understand from the moment one is given how much that a currency is effectively a good whose value can change against other currencies or other assets such as gold and crude .

What is Forex Trading?
In a transaction currency, it sold one currency for another. The exchange rate represents the relative value between the two currencies. Normally, currencies are identified by a code "Swift" three digits. For instance, EUR = the euro, USD = the US dollar, CHF = the Swiss franc, etc. Here you can find the full list of codes. An exchange rate EUR / USD 1.5000 means that 1 € worth $ US 1.5

Sometimes, EUR / USD currency pair is called. The exchange rate can be reversed. Thus the EUR / USD rate equals 1,500 kinds USD / EUR 0.6666. In other words, 1 $ US worth € 0.6666. In the market reality, most currencies are quoted against the dollar, although there are important exceptions as mentioned EUR / USD, GBP / USD (British Pound) and AUD / USD (Australian dollar). Not as confusing as it may seem.

Exchange Systems
There are basically two types of exchange rate systems:

1. The system of flexible exchange rates
2. The system of fixed exchange rates.
1. In a system of flexible exchange rates, currency "float" freely and its value is determined by market forces.
2. In a system of fixed exchange rates, the currency may not fluctuate freely, as their value is fixed in relation to a particular currency such as USD, with a specific type, or in relation to a basket of currencies. In a fixed system, the central bank uses its foreign exchange reserves to prevent any movement of the exchange rate fixed
.
What influences the market price changes
There are many factors that influence the value of a currency flexible type in the foreign exchange market, since the flows of international trade, economic or political situation given the level of interest rates until supply and demand short term. Unlike many other assets, FX is a pure market and rates move freely in both directions.

counter market
The foreign exchange (FX) is predominantly a counter market. Most transactions do not take place in a single regulated market, and this is one of the reasons why, despite its huge size, the forex market (FX) still find it confusing to many investors. However, technological advances have improved the transparency of this market and has opened to a larger number of operators. The FX market is open virtually 24 hours a day, 7 days a week and transactions are increasingly electronically.

Major players in the Forex market
Banks are major players in the FX market. The interbank trading represents the largest volume of Forex volumes. In this market, major banks trade directly with each other using inter-bank brokers or electronic trading systems such as Reuters. The bigger the bank, the greater their credit relationships with other banks which, for the customer, it means greater potential for better prices.

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Advantages of Forex trading

Advantages of Forex trading

  10:34 p.m.    forex

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Central banks, which control the supply of foreign exchange in their countries, specifically negotiate to achieve certain economic goals. Mainly by negotiating volume of foreign exchange reserves, they act in ways that affect or maintain the financial stability of the currency.
International corporations are important players in the foreign exchange market since considerable sums of currency change, as when buying goods or services to a foreign supplier.
Travelers who need to exchange currency to be abroad are also active players in the market.
Investors and speculators who take advantage of fluctuations in exchange rates have become aware of the opportunities offered by the Forex market. Much of the negotiation includes fit or hedging, a type of investment strategy designed to eliminate the risk.

Forex spot with respect to future currency

More and more runners prefer cash currency future for several reasons. First, the cash Forres provides better liquidity and overall costs lower than futures trading. In addition, banks and brokers in spot Forex give quotes 24 hours a day, without fees cause, as for currency futures associations such as the NFA (National Futures Association), which generally charge customers in the form of high commissions.


The mechanism of trading spot currency trading is similar to monetary futures. However, an important difference is the way currency pairs are quoted.

Future monetary always quoted as the currency against the dollar USD. For cash coins some coins also quoted as the currency against the dollar USD, while others are quoted as the USD dollar against the currency. For example, the EUR / USD is quoted in the same way that the future of the euro. This means that if the euro is strengthening against the dollar USD, the EUR / USD rise as euro futures rise.

However, in the currency exchange spot trading the Japanese yen as the USD dollar against the yen, while the opposite for future yen is performed. Therefore, if the yen rises against the dollar USD, the USD / JPY to lower cash, while futures on yen rise.-

The rule in foreign exchange spot is that the first currency is always the one that is quoted in terms of direction. For example, "EUR" in EUR / USD and "USD" in USD / JPY are listed currencies.

Advantages of Forex trading

24-hour market
The Forex market never sleeps. It is active 24 hours a day due to the time lag between major markets in Europe, Asia, and the United States. In the halls transaction, brokers working in three shifts to ensure availability. Customers have the ability to make orders to take profits (take-profit) and stop loss (stop loss) with runners to run overnight. The Forex market is open Sunday to Friday, giving riders the opportunity to immediately react to market news and determine their own trading hours.

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Tips for newbies in the Forex market

Tips for newbies in the Forex market

  6:18 p.m.    forex

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Keep it simple

There is no reason to seek a complex or convoluted strategy. The best strategies are perhaps the simplest, which involved fewer elements when making decisions. By most indicators, graphs, ratios, oscillators, etc. you use will not have better results, even it is more likely that your results are worse long term as many indicators can give you conflicting signals.

Specialize in a single currency pair

Following the above, simple works. Needless to handle and all currency pairs because this way we might escape interesting things. Focus on a single currency pair allows us to concentrate all our efforts to understand how their trading moves.

If we try to trade with 5 pairs at the same time, learn to negotiate it becomes very difficult. We will have to learn the characteristics of each currency pair separately as each pair is unique. Each currency pair:

Reacts differently to the news
They are moving at different speeds
Experience different movements depending slots
They must be managed in different ways as it remains an open position
If you are new, you start with a single pair. Once you are consistent with one, you can start to learn the characteristics of another.

Choose one term

In the same way as the above, it is advisable to start trading always using the same time horizon. This has several benefits:

allows us to focus on learning one time, therefore, we eliminate the confusion that can lead us to operate in multiple time horizons.
We should only look at a single graph, thus improving the efficiency and quality of our analysis.
We avoid conflicting signals that can occur if you use different time horizons.
Remember that all this is to make everything easier. Once you go through experience can start your analysis more complicated.

simple graphics

Most rookies accumulate as many indicators as possible within a price chart. They feel that the more indicators will fare better use.

The reality is that more indicators, the greater the degree of confusion as many are contradictory and give conflicting signals. Besides graphics become more difficult to read and have no clear signals.

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The experience will make you money

The experience will make you money

  6:15 p.m.    forex

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Thanks to leverage the currency market or Forex (Foreign Exchange) has reached the small investor and has become popular as an option investment. This market operates 24 hours a day and moves massive amounts of money, in fact, is the most active and liquid market there today.

As in any investment will be at risk and we have to evaluate them before you start investing. If you decide to take the plunge and dive deeper into the world of forex trading, here are a few tips for before you start investing.

This is very simple, but always keep in mind. Many people skip the basics and want to learn to operate directly in the currency market. This is a fatal error and we can get quite expensive. If you're a newbie in Forex, the first thing we have to do is learn and understand the basics.

If you expect to get rich overnight, you're wrong and you better not miss before you start and look for alternatives. Do not be naive, experience in the world of trading is one of the most important factors. The more we operate on the market, the more efficient we become. With the experience we can get to see things that newbies do not see. The way to become a good trader is long, so you must be willing to learn and gain experience until you become a profitable operadorconsistentemente.

Beware of "experts"

The problem of financial markets is a rookie that curdles a good week thought to be an "expert" or guru. Another type of "expert" that we can find online are those who beg us to buy your book. These people may have failed as traders and now want to make money teaching other traders fail. These self-proclaimed experts tend to:

Release generic information that today does not work.

They say they are traders with lots of money and still trying by all means to put you his book.

They claim to have invested 1000 euros per month and got 1 million.

Skillfully use mathematics to look more professional.

Before blindly believe in one of these "experts" reflect and think things through. If someone had a magic wand with which to make money easily, not say, but other operators would do the same and lose its advantage. What they seek this kind of "gurus" are people who fall into the trap of buying his book (in which usually only found basic things, impractical and does not currently serve).

Make your own analysis

Following the above, blindly following others will make us blind. Our goal is to become a successful trader and not someone who copy or follow strategies of others. What do others helps us to analyze and reflect on it. What we learn we can incorporate into our analysis in order to become a consistent long term trader. Simply copy others will not make us better traders, we will be good but not negotiating copying.

As an operator we need to develop a strategy and learn to analyze the market. Being able to make our own market analysis will take us closer to being a professional trader. Make a proper analysis allows us to:

being self-sufficient

Learn to trade currencies

The myth of demo accounts

For example, if we want to be professional footballers, we will not buy a football game to start our training. The same happens with demo accounts that we provide most platforms that people use in hopes of becoming a successful Forex trader.

Demo accounts do not work for 2 reasons:

We offer a false confidence and make us to catch bad habits.

These accounts do not work like a real account in terms of speed of execution and other relevant factors.

On the other hand demo accounts they have the advantage of allowing us to know the basics about operating in the Forex market. When you try to gain experience, we only operate in a real account.

We can start with little money and taking as we fluidity and consistency gradually increase gradually.

It limits losses

It is the most important rule to follow is mandatory. You must be willing to assume some level of loss and put there a maximum limit of money you can lose. Thus if prices fall below that level alone we will have lost what we were willing to lose. We have to play with these limits and not too much tightening at the bottom prices because small fluctuations may cause premature closure of our position.

We must also operate with a clear head. For example if we take a run of several days at a loss, it is best to rest a few days and come back fresh. Negative spurts can lead to large losses and to make decisions that at another time had not taken.

Be prepared for the ups and downs
Each strategy has its ups and downs. There is no system that is 100% rentabledurante all year. So we must be prepared for fluctuations. As we said earlier, success is measured in the long run. The problem is that many novice prove a strategy and if it does not work them during the first week set aside and a new test. It is advisable to see how the strategy behaves medium / long term.
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