Free FX Trading Guide Following JPMorgan Loss and Greek Woes

LONDON, May 15, 2012 /PRNewswire/ --

How are you going to trade forex following a reported $2 billion trading loss from JPMorgan and continuing woes in Greece? Find out with our free and comprehensive guide to forex trading.

JPMorgan Suffers Reported $2 billion Loss

The biggest US bank by assets, JPMorgan Chase & Co, lost a reported $2 billion in a trading blunder on Friday 11 May 2012.

In the wake of the loss, Chief Investment Officer (CIO) Ina Drew retired (Monday 14 May 2012) after losses were reported to potentially reach $3 billion or more.

According to bank executives, the cause of the loss was a mismanaged portfolio of derivatives tied to the creditworthiness of bonds.

Sterling Falls against the Dollar

The news out of JPMorgan and continuing political crisis in Greece has had a negative impact on sterling, seeing it hit a three-week low against the dollar on Friday as investors aimed to avert risk stemming from the US bank's losses and rushed to find refuge in safer haven currencies.

As a result, the dollar has been seen as a safe haven by forex traders; with sterling declining 0.5% to $1.6062 against the US dollar on Friday afternoon (accurate at 15:00 BST).

How to Trade Forex: GBP/USD

As one of the most liquid markets in the world, there are multiple opportunities for investors to profit from speculating on the future direction of currencies with City Index; through buying or selling the exchange rate of one country's currency against another.

For example, you decide to go short and sell the GBP/USD currency pair following recent news from JPMorgan and Greece, which has weakened the value of the British pound. This means you simultaneously sell the first currency (GBP) and buy the second (USD).

You have decided to sell in this example because you expect the first currency in the pair to fall and in turn, your profits to rise.

Why Trade Forex with City Index?

Today more and more individual traders are discovering the benefits of derivatives, and many of them are discovering them through a City Index forex trading platform.

As a group, City Index transact in excess of 1.5 million trades every month in over 50 countries, providing access to a wide range of instruments including margined foreign exchange, CFDs and, in the UK, financial spread betting.

In addition, they constantly aim to improve the performance across all their platforms and expand their range of services - including educational tools and resources.

As a result, their clients benefit from innovative trading tools with transparent pricing, competitive spreads, and a high standard of customer support. Visit http://www.cityindex.co.uk for details.

SOURCE City Index