Forex from scratch --a helping hand from pipshower...

pipshower · #1 5th March 2009, 02:23 AM

It seems a very few Indians really trading forex for profits ...
The reason quite obvious that no one even me is not aware of the precise rules and regulations in India to trade forex market .
Adding to that Forex market is nonadvertised and not discussed field in India putting it into the list of opportunities that very rarely come into attention of common people like you and me..

Saying this i would like to shed some light on Forex markets to help those who are really interested in looking for adding another way to generate profits ....

This thread is dedicated to common man searching for an opportunity or place to start exploring world of currencies ....

So this will be place for Starting a learning process for forex markets from scratch --a helping hand from me...

Let me clear this fact that I am not a master in forex .
I am just a small trader who consistently pulls profit from forex .

With this I would be adding more information as time permits ...
Hope this thread will be helpful to atleast 1% of the people who visit this thread..

Regards
Pipshower

pipshower · #2 5th March 2009, 02:33 AM

Let me start with the most commonly asked question as i know that many members reading this post would ask the first question as --

" Whether forex trading is allowed in India to individuals? What are rules and regulations in India for forex trading?"

Answer: I would like to put a post by one of the members of Traderji -- Mr . Ankit Garg who is working with ICICI , as i find that to be an appropriate answer to this

Quote:

Originally Posted by ankitgarg20

Well, Actually its not my profession...As in we trade for corporates..So, we dont interact with individual traders..

Now, coming to the point whether Currency Trading is Illegal in India or not....The answer is ; Nothing is clear on that.

On one hand you can trade USD/INR pair(only) on MCX and NSE through the futures contracts(not Spot).

Also, RBI has no where commented on forex trading being illegal. They havent allowed it specifically and neither have they made it illegal. Its very ambiguous stand of RBI and as a result different people take it differently. Risk takers go ahead and trade it and Risk aversors just leave it.

I personally dont know anyone who trades forex from India. But, I am more than 100% sure that many traders do that.

Luck

Ankit

I would like to add a link from RBI website where you can read and gather information about this ..
Here is link
http://www.rbi.org.in/scripts/faqview.aspx?id=53

That is all i can answer to this question of legality of forex trading by Individuals in India.
UPDATE TO THIS POST:
I WENT THROUGH VISITING MOST BANKERS AND ALSO GATHERED INFORMATION FROM RBI AND INDIAN RESIDENTS ARE NOT ALLOWED TO TRADE FOREX IN INDIA.
HERE IS MY POST ABOUT IT.
http://www.traderji.com/forex/27058-...tml#post297536

Regards
Pipshower

manaranjan500 · #3 5th March 2009, 09:13 AM

Dear Pipshower

Nice thread. Waiting for more.I have many questions. I think as a trader you explain from first to last.
thanks

beethoven · #4 5th March 2009, 09:38 AM

Thankyou Pipshower,

Many questions remain unanswered and many apprehensions still remain as I have put them in this post

http://www.traderji.com/forex/22876-...tml#post277967

I have gone thru RBI list and still am not convinced. Many people in the banking circle still say it is illegal. Maybe some legal expert can comment on this - I sure there are many legal experts in this forum.

Had it been so clear then many would have been trading as in India a vast pool of traders is there who can jump into forex. Till now this is limited to people who have had some exposure to this trading by having been lucky to be outside India and have some money in offshore banks and hence an account with a forex broker.

But for resident Indian -- the route is circuitous and smacks of illegality and hence a sense of unease, also an offshore broker does not give confidence that our interests will be addressed and any grievance will be speedily dispensed with in a customer friendly way (Indians are usually given a raw deal everywhere).

All these issues are important if we have to trade our money with a peaceful state of mind which is a must for trading anything.

Bee

pipshower · #5 5th March 2009, 11:14 AM

Quote:

Originally Posted by manaranjan500

Dear Pipshower

Nice thread. Waiting for more.I have many questions. I think as a trader you explain from first to last.
thanks

Hello Manaranjan ,
I will be proceeding that way from the very basics to the pro level .
Just have patience as i will be adding more and more information as the time permits.
Thank you for showing interest .

Regards
Pipshower

pipshower · #6 5th March 2009, 11:39 AM

Quote:

Originally Posted by beethoven

Thankyou Pipshower,

Many questions remain unanswered and many apprehensions still remain as I have put them in this post

http://www.traderji.com/forex/22876-...tml#post277967

I have gone thru RBI list and still am not convinced. Many people in the banking circle still say it is illegal. Maybe some legal expert can comment on this - I sure there are many legal experts in this forum.

Had it been so clear then many would have been trading as in India a vast pool of traders is there who can jump into forex. Till now this is limited to people who have had some exposure to this trading by having been lucky to be outside India and have some money in offshore banks and hence an account with a forex broker.

But for resident Indian -- the route is circuitous and smacks of illegality and hence a sense of unease, also an offshore broker does not give confidence that our interests will be addressed and any grievance will be speedily dispensed with in a customer friendly way (Indians are usually given a raw deal everywhere).

All these issues are important if we have to trade our money with a peaceful state of mind which is a must for trading anything.

Bee

Hello Beethoven,
Very valid questions but as i said in the previous post that the information i have about this issue that much only .
But i have a very good news for you ---
If you are serious in investing and trading money i bet you have a bext option available now:
Interactive brokers introduced in India
They have Indian stocks, most world markets and forex under one roof..
Go here
http://www.interactivebrokers.co.in/en/main.php

They have put that they are coming under regulations of SEBI ..
I would like to put the data they have on there website
"Interactive Brokers (India) Pvt. Ltd., Member of National Stock Exchange of India Ltd. Member code 12880 (http://www.nseindia.com/). SEBI Regn. No. INB 231288037 (CM), SEBI Regn. No. INF 231288037 (F&O) (http://www.www.sebi.gov.in/). Registered Office at A-605, Dynasty Business Park, 151 Andheri Kurla Road, Andheri East, Mumbai 400059, India."

Ok ..let me clear i am not in anyway affiliated with them nor do i have personal interest with them . But they are undoubtebly one of the best in forex arena.
Though there platform doesnt stand anywhere near MT4 platform but we can use other brokers MT4 platform for our analysis.

Thats what i have as answer to your question.

UPDATE ON THIS POST :
AFTER I CONTACTED IB they say indians are not allowed to trade forex . So the issue of trading forex for indians is solved and we are not allowed to trade forex.
Regards
Pipshower

pipshower · #7 5th March 2009, 12:03 PM

Quote:

Originally Posted by beethoven

Thankyou Pipshower,

Many questions remain unanswered and many apprehensions still remain as I have put them in this post

http://www.traderji.com/forex/22876-...tml#post277967

I have gone thru RBI list and still am not convinced. Many people in the banking circle still say it is illegal. Maybe some legal expert can comment on this - I sure there are many legal experts in this forum.

Had it been so clear then many would have been trading as in India a vast pool of traders is there who can jump into forex. Till now this is limited to people who have had some exposure to this trading by having been lucky to be outside India and have some money in offshore banks and hence an account with a forex broker.

But for resident Indian -- the route is circuitous and smacks of illegality and hence a sense of unease, also an offshore broker does not give confidence that our interests will be addressed and any grievance will be speedily dispensed with in a customer friendly way (Indians are usually given a raw deal everywhere).

All these issues are important if we have to trade our money with a peaceful state of mind which is a must for trading anything.

Bee

HOW DID I DEPOSIT TO BROKER IN LEGAL WAY?

Also for the reason of whether it is illegal to send money outside i have never ever done a deposit using either credit card or my bank account. Since i always wanted it to be legal.
I actually deposited money into my brokers account through paypal where i earned enough money to fund my forex account from various online projects i was part of ...That makes it totally legal.
And the profits over it are withdrawen to Paypal and from there to bank account which fits in regulations posted at RBI site i previously mentioned.

Regards
Pipshower

NOTE: You can always fund your paypal by asking your friend or someone from india to transfer there paypal funds to your paypal acct and you pay them directly in cash or some sort of exchange .
I have never done this but this is just what i have seen done by many .I am just sharing what i have seen done on internet and i am not responsible for the danger it puts you in regards to rules and regulations of govt of india .

pipshower · #8 5th March 2009, 12:29 PM

Before you start out ...
read this at least 10 times
forex is not get rich quick scheme!!

forex trading involves substantial risks

forex trading is skill not gambling .

Trading without a certain plan and considering forex as gambling would empty your bank account .

Forex trading is very risky if you dont know what you are doing and why you are enetering trade without sound reasoning...

Forex trading is not for those who are not ready to put enough money for they are ready to lose.

Forex trading is not for faint hearted people.

Regards
Pipshower

pipshower · #9 5th March 2009, 12:34 PM

Why forex trading was unknown till lately?

Answer: Forex trading was only available to players who had at least 10 million dollars to fund there forex account before 90's . This included bankers and big corporate players.
In late 90's it was opened to retail investors like you and me .

beethoven · #10 5th March 2009, 12:38 PM

Quote:

Originally Posted by pipshower

HOW DID I DEPOSIT TO BROKER IN LEGAL WAY?

Also for the reason of whether it is illegal to send money outside i have never ever done a deposit using either credit card or my bank account. Since i always wanted it to be legal.
I actually deposited money into my brokers account through paypal where i earned enough money to fund my forex account from various online projects i was part of ...That makes it totally legal.
And the profits over it are withdrawen to Paypal and from there to bank account which fits in regulations posted at RBI site i previously mentioned.

Regards
Pipshower

NOTE: You can always fund your paypal by asking your friend or someone from india to transfer there paypal funds to your paypal acct and you pay them directly in cash or some sort of exchange .
I have never done this but this is just what i have seen done by many .I am just sharing what i have seen done on internet and i am not responsible for the danger it puts you in regards to rules and regulations of govt of india .

Pipshower

There are many ways to send money abroad and open a forex account which does not require too much skill or expertise. You have earned your money abroad and spending as you wish is outside the ambit of Indian jurisdiction. Main question is resident Indian cannot use INR earned in India and send it abroad for Forex trading which makes it a speculative spending which is not allowed by RBI regulations, I think.

We have to discuss ways of doing trading on this public forum keeping in mind the laws of the land.

Bee

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