USDINR trading for living? Possible??

[Contra]

Entry barriers to "profitable" equity trading are still high. In this scenario, Forex trading has the potential to become a serious alternative to equity trading as long as it's positively encouraged by RBI, the exchanges and trading participants.

 

[ztas]

Yes trading forex derivatives such as USDINR and EURINR for a living is doable in India. I have been trading these pairs successfully for the two years. Short EURINR futures trade was highly profitable last year. Likewise long USDINR trade has been profitable in the last six months.

Pros vis-a-vis index derivatives:
A. Fine position sizing with lot size 1000$ and 1000€.
B. Low margin requirement.
C. Less volatile and more trending.
D. USDINR futures are extremely liquid. A position of 1 million $ can be created or squared with minimal slippage (under 2 ticks).
E. There is no STT which is a big saving.
F. Since all currency futures trade at a premium to the spot, shorting them in an ongoing downtrend gives additional income.

Cons vis-a-vis index derivatives:
A. Our markets are closed during news from ECB or the US Fed. The moves post news can kill your trades and leave a big hole in your p&l. Handle it much like you would handle FOMC decision on rates.
B. Poor liquidity in non$ contracts like €, £ and Yen.
C. Options are only available for USDINR as of now.
D. Cross pairs like EURUSD can be constructed by using two legged trades in € and $. But they cost more due to poor liquidity in EURINR.
E. RBI intervenes heavily at times and one must be careful of such moves. These moves can easily shave off 15-20 paise in a few minutes only to resume the uptrend later. In rare cases big traders can get informal requests/threats to cut long positions in USDINR (e.g. taper tantrum time in late 2013).

Regards
Curious_Trader

Thanks for the info.

Which broker do you trade forex?

 

[NewStarS]

My paper trading on USDINR options made my account sized doubled after 30 trades.
Steady pair...

 

[cloudTrader]

My paper trading on USDINR options made my account sized doubled after 30 trades.
Steady pair...

Were your Option paper trades in USDINR based on positional calls

Happy Trading.

 

[Rajeevji]

Yes trading forex derivatives such as USDINR and EURINR for a living is doable in India. I have been trading these pairs successfully for the two years. Short EURINR futures trade was highly profitable last year. Likewise long USDINR trade has been profitable in the last six months.

Pros vis-a-vis index derivatives:
A. Fine position sizing with lot size 1000$ and 1000€.
B. Low margin requirement.
C. Less volatile and more trending.
D. USDINR futures are extremely liquid. A position of 1 million $ can be created or squared with minimal slippage (under 2 ticks).
E. There is no STT which is a big saving.
F. Since all currency futures trade at a premium to the spot, shorting them in an ongoing downtrend gives additional income.

Cons vis-a-vis index derivatives:
A. Our markets are closed during news from ECB or the US Fed. The moves post news can kill your trades and leave a big hole in your p&l. Handle it much like you would handle FOMC decision on rates.
B. Poor liquidity in non$ contracts like €, £ and Yen.
C. Options are only available for USDINR as of now.
D. Cross pairs like EURUSD can be constructed by using two legged trades in € and $. But they cost more due to poor liquidity in EURINR.
E. RBI intervenes heavily at times and one must be careful of such moves. These moves can easily shave off 15-20 paise in a few minutes only to resume the uptrend later. In rare cases big traders can get informal requests/threats to cut long positions in USDINR (e.g. taper tantrum time in late 2013).

Regards
Curious_Trader

Hello Curious trader,

It is almost 12 months since you posted something in traderji.com. Would you like to consider starting a thread on Currency trading since you have experience in this area and its new to India.

Regards

Rajeev

 

[senthilan]

The word " trading for living" is sounds good, But,
This takes a huge amount of time and energy.

You need do dedicate yourself, and don’t give up. It’s hard in the beginning, but after a while, you will learn to know the prices, and start to care about the development in your market. Try to focus on one currency pair, and pay close attention to the economic calendar.

You are using your real money, and you care about it, right?!

 

[Rajeevji]

The word " trading for living" is sounds good, But,
This takes a huge amount of time and energy.

You need do dedicate yourself, and don’t give up. It’s hard in the beginning, but after a while, you will learn to know the prices, and start to care about the development in your market. Try to focus on one currency pair, and pay close attention to the economic calendar.

You are using your real money, and you care about it, right?!

Hi Senthilan,

You are three years into full time trading Forex. Can you please lead the discussion here.

I have been a long-term investor for 25+ years.

In last 4-5 have delved into Futures on and off - but could not make a success as I had a full time job and did not give continuous attention to trading. Luckily there was no big loss on the whole in Futures. But anyway, came with a feeling that Futures are not my cup of tea (filter coffee) - they look a bit risky to me and low win-rates put me off.

Now I am on verge of retiring and I have started trading Options - short strangles, vertical spreads, covered calls . The experience so far is good. And this jouney is likely to continue.

I want to learn Forex trading for diversifying the instruments traded. Looking for a bit of experience sharing by people who are in the field.

regards

Rajeev

 

[senthilan]

Hi Senthilan,

You are three years into full time trading Forex. Can you please lead the discussion here.

I have been a long-term investor for 25+ years.

In last 4-5 have delved into Futures on and off - but could not make a success as I had a full time job and did not give continuous attention to trading. Luckily there was no big loss on the whole in Futures. But anyway, came with a feeling that Futures are not my cup of tea (filter coffee) - they look a bit risky to me and low win-rates put me off.

Now I am on verge of retiring and I have started trading Options - short strangles, vertical spreads, covered calls . The experience so far is good. And this jouney is likely to continue.

I want to learn Forex trading for diversifying the instruments traded. Looking for a bit of experience sharing by people who are in the field.

regards

Rajeev

Dear Rajeevji,

First i respect your experience, i don't have any experience in USD/INR, i have been trading with only Global Major Fx crosses like EU, GU, EJ, UJ, GA, etc., if there is any help pm me, i can give my best

 

[Hulu Girl]

Master one strategy and keep practicing with a small amount initially and proper risk control methods.

 

[The White Queen]

The USD INR has been moving in a very good uptrend recently. I wanted to join the trend, but I didn't know how scared I was.