OANDA

OANDA uses innovative computer and financial technology to provide Internet-based forex trading and currency information services to everyone, from individuals to large corporations, from portfolio managers to financial institutions. OANDA is a market maker and a trusted source for currency data. It has access to one of the world's largest historical, high frequency, filtered currency databases.

OANDA Services

OANDA.com—Currency information, tools, and resources for investors, businesses, and travelers.
fxTrade—A fair, transparent, low-cost and flexible forex trading platform for traders, investment managers, financial institutions, and corporations.
Forex Blog—RSS feeds and daily market reports from our resident currency analysts.
OANDA Research and Innovation—Read our Forex Lab Notes blog about innovation, product design, and next-generation trading technology.

OANDA Subsidiaries

OANDA Asia Pacific Pte. Ltd. (Singapore)
OANDA (Canada) Corporation ULC (Canada)
OANDA Europe Limited (United Kingdom)
OANDA Japan Inc. (Japan)

OANDA was founded on the belief that technology and the Internet would globalize the marketplace, creating an unprecedented need for currency-related products and services. Today, the global forex market trades over $4 trillion/day (30 times larger than NASDAQ and NYSE combined), with online retail trading a rapidly growing part of that market. 

Possessing one of the world's largest and most accurate databases of currency rates, OANDA was the first in 1995 to offer a broad range of currency exchange-rate information free of charge over the Web. Today, it handles more than a million queries a day. In 1997 OANDA became an Internet-based business-to-business application service provider (ASP) and currently services over 75,000 ASP clients around the world.

With its launch of fxTrade in 2001, OANDA was one of the first companies to offer fully automated online currency trading. The OANDA fxTrade system provides retail and institutional clients a state-of-the-art platform that enables competitive, real-time access to the foreign exchange market.

OANDA was co-founded by Dr. Michael Stumm, a professor of Computer Engineering at the University of Toronto, and Dr. Richard Olsen of The Olsen Ltd., a leading econometric research and development firm. The company was incorporated in the state of Delaware in 1996.

OANDA is an established forex market maker, whose proprietary technology provides financial institutions with consistent access to the deep liquidity they need to trade effectively and with confidence.OANDA has changed the landscape of the forex market. The company leverages its extensive retail volume, access to deep liquidity from top banks, and effective trading algorithms to offer a truly alternative source of forex liquidity.Institutional clients include hedge funds, qualified trading firms, corporate clients, broker dealers, proprietary traders, leading world banks and other financial institutions. Their mission-critical systems and strategies depend on OANDA's proprietary technology, which typically processes hundreds of thousands of forex transactions daily.  Fully regulated with a solid financial balance sheet. OANDA has offices in the U.S., the UK, Canada, Switzerland, Singapore, and Japan. Its award-winning fxTrade platform is built on core principles of innovation, transparency, and fairness, and licensed by two out of the ten leading foreign exchange banks. 

How Are OANDA Rates™ Calculated?

The exchange rates provided in our Currency Converter and other tools are averages for the global foreign exchange market gathered from frequently updated sources, including our OANDA fxTradecurrency trading platform, leading market data vendors, and contributing financial institutions. The data is filtered and stored in a proprietary data repository.
We do not take market closing prices as the "average" price. Instead we take the average from all our collected data over a 24—hour period, reflecting the fact that the foreign exchange market never really "closes" on a global basis. However, market activity is lower on weekends and holidays, so the number of prices varies from day to day. Our Rates are rounded to up to five significant digits, with a few exceptions.

How Accurate Are OANDA Rates?

OANDA rates are trusted and used by major corporations, tax authorities, auditing firms, and individuals around the world.

For major currency pairs, our rates are based on tens of thousands of different price points, collected every few seconds, 24 hours a day, 365 days a year. We collect these rates from live data suppliers, filter them to remove false prices and validate the data, and use the filtered data to compute interbank market rates.

Note: You may see the message in the Currency Converter's Details section, "Estimated price based on daily US dollar rates." This message is displayed for currency pairs where relatively little data is available, and means that the exchange rate for the converted currencies was computed from cross rates with the US dollar.

How Often Are OANDA Rates Updated?

The period of time over which the average bid/ask currency price is taken depends on the data available for the particular currency. When possible, we take the average of prices over the last 24 hours and use these averages to update the rate every day at 22:00 UTC (Coordinated Universal Time).

Prices for the currencies of some emerging market countries may be published once per day or even less, resulting in only a few price points each week for these currencies.

Why Can't I Get Interbank Rates From a Bank?

The prices quoted by the Currency Converter are based on interbank market rates and generally reflect the exchange rates for transactions of US $1 million or more. These are the "official" rates quoted in the media, such as The Wall Street Journal. Retail spreads (the difference between the Bid and Ask prices) for smaller amounts are not reflected in these interbank prices since they vary among payment systems, countries and banks.

If you go to a bank in your home country, you usually have to pay more of your home currency to get foreign currency than you will receive of your home currency, if you return the foreign currency. This results in the two exchange rates shown in the margin result.

Because these retail rates vary so much in every place, we cannot advise you where to go at any given moment to change currencies. You can usually find out such information from your local bank, travel guides, or people who have visited the place you are heading for.

How Do I Choose the Rate that Applies to Me?

Interbank rates (+/- 0%), with a margin close to zero, are the "official" rates quoted in media such as The Wall Street Journal. They typically reflect the market rates for large transactions of US $1 million or more when banks trade between themselves or with their very large clients.

For the smaller amounts exchanged in a retail setting, banks, credit cards and exchange agencies charge commissions to convert currencies. These retail rates add commissions of 1 to 10 percent or more. For example:

• ATMs typically add 2% (and then add service charges in many parts of the world).
• Credit cards typically add 3% (for the major currencies; more for other currencies).
• Foreign exchange kiosks and banks often add 5% when you convert hard cash (for the major currencies; more for other currencies).

Retail rates vary widely between payment systems, countries and banks, so we encourage you to enquire about the rates your financial institution is actually charging you.

To add a commission to your conversion, you can use the Interbank +/- pull-down on any of our applications. Either choose the commission from our list of typical charges, or type in a value if you know the rate you will be paying:

What are Bid and Ask, Sell and Buy?

When you convert currency, you sell one currency to buy another. Your financial institution charges you a different rate if you are selling a currency (the Bid, or Sell, rate) or buying a currency (the Ask, or Buy, rate).

You can see these two types of rates in the lower details section of the Currency Converter:

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• The Bid (or Sell) rate is the lower amount. You will receive fewer euros when selling your dollars. (This is the number you see in the right field of the converter.)
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• The Ask (or Buy) rate is the higher amount. It will cost you more dollars when buying euros.
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Many currency information sites provide the Midpoint rate, which is the average of the Bid and Ask rates for a currency pair. At OANDA, we default to the Bid price for our applications, as it more accurately mimics the rate that you would be charged if you were exchanging money. We do provide Midpoint rates as a point of reference in our Historical Exchange Rates tool.

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Forex Information Useful For Every Beginner

The most common information and the initial knowledge along with understanding Forex trading can assist you a lot if you do your first steps in this direction. Surely, any article or issue even the most detailed one can’t give all necessary Forex information a beginner should know before starting a trade but the most basic data you can learn from reading the following article dealing mostly with explanation of terms and the Forex market scheme of work. 

Any basic Forex information would not be full without explanation of what Forex means. Forex market or sometimes called as FX stands for a foreign exchange market (also known as “currency market”) where people – traders and brokers – are involved into buying and selling world currencies against each other. At the moment a lot of people join Forex market as traders due to great popularity and huge financial base and opportunities this market can offer even if comparing it with stock exchange markets. Besides approximate daily trade results which Forex and related markets show are really impressive –more than 3 trillion USD – which is over all results of all U.S stock markets. Due to the fact that trading at Forex market can be conducted all over the world by means of the Internet and other communication means like fax and phones Forex trading is also considered as one of the most convenient and easy to use ones comparing with stock markets.

If you want to start your Forex education in a correct way you need to learn to distinguish Forex market and stock market scemes of work because many newbies suppose by mistake that these two markets work basing practically on the same principles and using the similar tools and instruments. There are plenty of differences but only two of them denote the evident dissimilarity between these types of markets: 

1) Difference in trading hours. The main advantage of Forex market is that it works 24/7 without breaks and day offs. Forex information and trading itself can be provided from three continents from a lot of big cites like Tokyo, London, New York, Zurich and many others which allows following and reacting in a proper way at various and fast fluctuations happening at Forex market. As for the stock markets – they open at Sunday night and close on Friday evening. 

2) Commissions can be different. Online electronic Forex trading and high competition created circumstances making possible reducing in bit-off spreads (equals to stock commissions). Such spreads cover all those risks which are inevitable when one deals with the market makers. Many people find Forex spreads rather low but any spread can rise if the currency liquidity drops due to some reasons. Besides such Forex commissions considered as the lowest ones according to trade sizes comparing with stock markets in spite of the fact that lately FX commissions have been reduced. In the most Forex trading houses leverage is offered as 100 to 1 (for example a trader who can suggest a deposit fund of 10 000 USD can leverage this sum up to 1 million USD). Such situation involves interference of speculators who can narrow a pip spread but government and the hugest banks impact on prices and commissions as well so the chances are equal. Besides never heed that stock markets offer all participants involved into trading an equal level of an access and practically the same prices while the Forex market suggests few totally various levels of an access where commissions and spreads differ from every next level. The hugest investing banks involved into Forex trading can offer the lowest spreads. 

Why spreads are so important in Forex trading? 

Any initial Forex information presupposes explanation of spreads functions and meaning. To explain what is a spread we need to appeal to such terms as the BID price and the ASK/OFFER price. The BID price means the price at which a trader can easily sell one unit of any base currency offered at the Forex market (or buying one of secondary currencies) and the ASK/OFFER price stands for the price used by a trader for buying a unit of one of base currencies. The following example explains this in practice – if the exchange rate of the currency pair EUR/USD equals to 1.3473/1.2476 it denotes that a trader should pay 1.2476 USD to buy one Euro (which is obviously a base currency) and if a trader sells one Euro he will get 1.3473 USD. You see, it is not so hard to figure out. As you have noticed the BID price was lower than the ASK/OFFER price and that tiny difference between these two prices is called a spread which is measured in “pips” (1.2476 - 1.3473 = 3 pips) and in such way denotes the possible profit and the dealing room used in the Forex trading houses. 

And the last piece of Forex information we want to discover deals with retail Forex trading. The mentioned before market makers or also known as retail Forex brokers work representing retail customers and capture one of the smallest niches of the Forex market. Due to the dry statistics data – retail Forex broker is responsible for estimation of the total volume of retail trading which equals up to 50 billion per day (around two percent from the total value of the whole Forex market). However this segment shows a tendency to grow lately because of appearing high quality Forex trading platforms and individual traders using these platforms.

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Exploring Basics of Technical Forex Analysis

For those who only make their first steps in the Forex trading and try to figure out how this huge financial market with plenty of opportunities to earn the fortune works such words as technical or fundamental analysis mean nothing or at least a little. Due to the fact many people risk in order to gain something at this available and free for any sort of speculation with currency exchange rates market it requires knowledge concerning the most widespread strategies used by experienced traders who are quite successful in earning money at the FX market.

As it was mentioned there are two types of analysis exist at the FX: technical and fundamental. While fundamental Forex analysis is based in gathering and analyzing Forex trends of past technical analysis is grounded on studying of price charts in order to make forecasts concerning any prices fluctuations of any currency pair. As you may guess knowing basics of technical Forex analysis can serve as a solid background when you as a trader have to decide whether to buy or sell currencies at the FX market. 

The following issue concerns certain aspects of technical Forex analysis so you could get a full picture of what benefits it may give you if you study the basics.

The major purpose of the technical FX analysis is in studying price charts and this knowledge is quite enough to forecast any sort of fluctuations. For sure traders which use this Forex analysis's methods commonly have to follow the latest economical, political news in order to take them into account while analyzing the details within the price charts which help to predict price movements and their direction. That is why the most obvious purpose of the technical Forex analysis is to make money predicting possible changes within a certain price chart. Accurate analysis can make one a prosperous man and that is why no wonder many newbies try to figure it out. 

Methods of the technical Forex analysis include a variety of different techniques centered on studying price charts particularly. In the core of this analysis lies the estimation and forecasting of actual price action which is usually not so changeable but modern software offers such innovative tools for accurate setting up of charts that many traders can learn them in few months which is really fast taking into account a great amount of details and nuances. In addition to this the technical analysis involves formulas appearing on the top of the certain price charts. 

If we talk about Forex trading strategies we should mention technical analysis for sure because many effective and efficient trading strategies planned by Forex traders are based on this type of analysis for instance such as trend recognition and moving averages. Such strategies are planned by traders in order to lessen any risks to lose money to minimum and that is why they can be modified with methods taken from the fundamental Forex analysis. Let's say that any good FX trading strategy is factually based on technical analysis and involves elements of fundamental analysis as well.

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Understanding Forex Trading Strategies: Purposes and Common Types

To become a successful Forex trader it is not enough to have a sort of intuition to predict fluctuations happening with currency pairs and to be a lucky one to happen at the right place and in the right time. All these factors can play their roles, sometimes even significant ones, but the more efficient and logical way is to plan and follow your own trading strategy that can save your from unreasonable and risky operations.

Experts affirm that there exist a lot of widespread Forex trading strategies one may follow without taking into account stand-alone strategies of Forex trading used only by few traders. Below you can find a list of some well-know Forex trading strategies which can be considered as the most reliable ones and checked by many people as working and successful.

At first let’s try to define in brief what the main purposes every Forex trading strategy follows and how you can choose the best strategy for yourself. You need to figure out that it is rather stupid to consider that any strategy can give a 100 percent guarantee you will manage to bypass all pitfalls and earn money in a quick way without any risks and loses. Understanding any strategy in such way may cause a lot of troubles and bad consequences so it is better to stick to an idea that a Forex trading strategy is foremost a plan and it depends only on your own personal qualities how successfully you will manage to realize this plan. Another thing you should bear in mind that any reliable strategy contains all necessary tips and hints one may use to become a proficient trader.

Recommendations concerning selection of the best strategy from all existing Forex trading strategies can seem useless because as it was mentioned that everyone should choose a strategy according to his/her own preferences but still there are few advices one may stick while selecting one of such Forex trading strategies: 

- all strategies are based whether on a fundamental or technical analysis which means that traders may concentrate on certain calculations and periods of time or can stick to broad spectrum analysis while developing a trading strategy. Experts strongly recommend to use both fundamental and technical means of analysis to create a long-term strategy which can determine all points – whether entry or exit ones.

- never start a live trading without testing your strategy as an owner a FX demo account by means of which you can practice your skills until become pretty much sure in your plan and will manage earn money at least virtual one. Do not join the army of Forex newbies who started quickly and lost everything because of an experience lack. Hurry is not appropriate when it deals practicing in applying Forex trading strategies.

- in spite of your strategy plan you should always stick to the Forex trends which can be very fluctuated but still only by following them you can expect to be in the benefits eventually.

Taking into consideration all these advices you can start to choose the most applicable strategy for yourself. Here the list of the most common Forex trading strategies a lot of traders select as the major ones:

1) Forex Arbitrage Strategy. Such strategy predetermines a plan when a trader gets profits from ineffectiveness in the prices of numerous currencies. Some suppose that usage of such strategy is immoral but when it comes to legal business strategies what can stop you to win in all available ways? Besides those traders who use Forex arbitrage strategies contribute to stabilization of multiple currencies, which brings only benefits to all parties involved into Forex trading. Like any other strategy this one has lacks as well – it is a very complex one and requires a strong background in understanding all currency price inefficiencies. In addition to this you will have to compete with numerous traders who follow the same strategy using fine-tuned automated Forex trading software and platforms. 

2) Forex Account Management Strategy. In a case you see only faults and disadvantages in becoming a daily trader and are interested in investing more than in trading then you should definitely choose a Forex manager account strategy – which can be described in brief as a mutual fund where you can leave your money (having one of such Forex manage accounts) and then allow a hired professional trader to run this account instead of you. In such way you can get more experience without a lot of efforts and take all advantages from seasonal changes of Forex market. For sure, you will have to make your own analysis (fundamental one) of a currency and a country of a chosen currency to develop a profitable investment plan. 

3) Forex Range Trading Strategy. Finding levels responding in the resistance and support of certain currency pair is the key task and secret weapon for providing one of Forex range trading strategies. After identifying these levels you can purchase when this pair reveals support and sell in a case it shows resistance.

What are support and resistance levels? Support denotes the price of a certain currency pair if this price is not going to be reduced at the moment. Sometimes price just doesn’t want to reduce and such situation can be caused by many reasons. The main task is to notice a support level – when the price of a currency pair hits the bottom rate again and again but without being less than the bottom price. For sure there will come the moment when the currency pair price becomes less than the bottom price but you have to stay in the benefits while there is the support level. The same concerns the resistance level but on the contrary – there is the high price which doesn’t want to become higher. The range happens when the price of a certain currency pair goes up and then down reaching support and resistance levels and that is when you need to buy and sell basing on low and high points.

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How to Apply Forex News Information for Benefit?

Even if you are a newbie in the Forex verse you should definitely understand at the moment the importance of the so-called Forex news which stands for political, economical and social issues in a country which currency you have chosen for trading within the Forex exchange market. In order to estimate how a trader can use Forex news: whether bad or good one: to earn money instead of losing it you should read attentively the following issue.

As any other market Forex exchange market is also inclined to prices volatility cause by some financial and political news reports so no wonder many traders have to take into account this news of global and certain country importance. For instance, many FX trading strategies are based on the trading only those currencies that do not fluctuate in any direction according to the latest Forex news releases.

After news coming a trader just needs to move in the direction of the currency movement. Everything is pretty much simple: when the currency is going high you should buy and visa versa when it goes down it will be more reasonably to sell it. In order to stay in the benefits you need to study the list of the so-called Forex news on schedule which appears every trading day at the same time and in such way direct the currency fluctuations. Stability of a certain currency and then a sudden movement of it after Forex news releases denote that a trader has to follow the price movements. 

Surely there are certain alerts of Forex news which can become a real danger for your successful strategy and open positions and that is why you need to consider these alerts of FX news as well. 

To follow this news on a regular base you can read specific financial newspapers and magazines and visit the hugest online portals. However such tendency can bring a negative aspect because everyone gives his point of view and forecasts currency fluctuations and not all people are experts and this means that following every advice is not reasonable at all. And the most dangerous thing is that such Forex 'experts' are very ignorant or just mean and recommend newbies to do something wrong on purpose to get rid of competitors in spite of the fact there is enough of space for all traders within the FX market. Take this human factor as an inevitable part and stick only to those ideas which are spread by many real Forex experts. 

Another alert is that Forex market news can be delivered too late and you won't manage to react properly to derive benefits from your open positions. For example, when news reaches newspapers many employees of banks and other financial situations are quite aware of it and can use it as they want to stay in the profits. While you are reading FX news in a magazine or on a website as well as millions of other traders you can't expect to get an advantage and just follow this news because most of other traders will behave the same. That is why it is useful to have a middle-man in some huge financial organization and pay him if it is necessary to get really fresh news of the FX market. 

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FX Leverage: A Guide for Beginners

More and more people interested in getting money in a quick and reliable way appeal to the opportunities offered for them by the largest financial market of Forex: foreign exchange currency market to be more precise. However many naïve Forex rookies understand quickly that without certain theoretical background and practical experiences which one may get using beforehand demo accounts imitating live Forex trading only without real money there is no reason to start real-time trading because it will end with an epic fail at once.

From this point of view understanding what Forex leverage is can become a powerful advantage every new FX trader can use to earn few bucks at first and then perfecting his/her strategy of FX trading applying easily the most basic and required knowledge concerning Forex market. 

Foremost let's focus on the definition of leverage in Forex. It stands for a great opportunity offered for online traders (not only Forex can offer this but stocks market as well) which can provide success in the FX market and can also bring disappointment leading to a trader's bankruptcy sometimes.

Applying of FX leverage can be rather useful only if one is quite aware of possible risks this tool can bring. Leverage embodies a sort of an approach for trading with other trader's money so no wonder this method has its lacks and risks to lose everything. Many people find this opportunity very advantageous at the very beginning but then understand that Forex leverage can serve as a double-edged sword. Severe guarantee (meaning here a trader's deposit arrangement) forms its main lack. 

Many new traders suppose that Forex leverage serves as a trick and not quite legal which scammers use because the idea of trading other's people money seems too fantastic to be true. Nevertheless, leverage of the forex market really does it and legitimately so you don't have to worry about this. Take it as buying of a house with a mortgage and then returning money to a bank. Just imagine how many people would stay homeless without such a great opportunity a housing market offers? 

Why then this opportunity can't be applicable according to the financial market of Forex or stocks as well? The only difference is that Forex leverage provides a trader with a required mortgage. In order to render a mortgage guarantee the trader's deposit fund is used.

Forex leverage is based on the following scheme of work: a FX broker gets a credit (which is usually higher than deposit) basing on a trader's deposit letting in such way a trader open much larger positions for trading and logically get more profits if a deal is successful. Commonly a FX trader having one thousand of dollars as a deposit can trade within the range of one hundred thousand dollars of a base currency in his chosen for trading currency pair. In such way typical Forex market leverage equals 1:100. 

The most helpful aspect of using leverage is in the opportunity for trading within the margin and that is when proficient FX traders can apply Forex exchange leverage offer as they like. Taking into account FX leverage of no more than 1:15 and price movements a skillful trader can gain a lot of money.

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Forex Quotes: How to Read Them Correctly?

Heed the fact that reading Forex quotes can be not so easy thing to do as some not reliable Forex brokers and investors say because without knowing a certain order and nuances you won't manage to decipher quotes of the Forex market correctly which can bring such negative consequences as losing money or even being broken from the financial point of view.

If you suppose that you can read Forex quotes easily only due to the fact you got used to decipher stock quotes you are wrong as well because quotes in the Forex market are totally different. In a case you are quite sure in your forces and knowledge but can't read these quotes in a correct way forget about starting your careers as a Forex trader. 

Foremost let's focus on the fact that ciphering any FX quote is not as difficult as most of Forex beginners start to think after profound tutorials given by their more experienced experts. Never be confused with all nuances you will have to learn to read Forex quotes properly and better lose your energy on careful analysis of the following issues and tips.

Treating reading FX quotes seriously is not right but ignoring of this is not an option as well so stick to a golden mean and then you will need to find few professional advices and guides how to decipher FX quotes before investing real money into trading in the Forex market. The first investments are very important and should not be large but proper reading of quotes is required even at the initial level, so learn this method given below in the first turn.

There are two most meaningful things which concern Forex quotes you need to remember:

• the currency which is listed in the first turn is called the base currency;
• the value of the base currency is one (always, this number is stable).

During Forex market trading a participant should keep in mind that quotes which are usually two-sided and consist of the ask and bid prices. To decipher these prices you have to know that the ask price stands for the price at which a trader can purchase the base currency and simultaneously sell the counter (the second in the currency pair) currency. While the bid price means the price at which a trader can only sell the base currency.

What tips you should stick to in order to decipher Forex quotes?

- USD currency is by default considered as the base currency for FX quotes. It features such currency pairs as USD/JPY, USD/CAD and USD/CHF.

- a mix of two currencies which are involved into trading at the FX market is labeled as the 'cross'. USD/CHF denotes, for instance, that Forex quote is valid for a trader who intends to buy CHF using USD. 

- Forex quotes are mostly expressed as units of one dollar each per the counter currency in the pair chosen for trading. For example, a quote of USD/JPY: 120.01 - denotes that one dollar is equal to 120.01 yen.

- in a case a currency FX quote rises it denotes that USD has appreciated in its value and the counter currency has gone down. 

- in a case when the USD/JPY quote rises up to 123.01, USD is obviously stronger because using dollars a trader can buy more yens. However there are few exceptions here: British pound (GBP), the Euro (EUR) and the Australian dollar (AUD) can be classified as these exceptions. For example if the quote of the pair GBP/USD is 1.435 it denotes that one British dollar can be bought by using 1.435 USD. This means that USD in these three currency pairs is not the base rate and a rising of a quote denotes a weakening of dollar's position because a trader will require more dollars to buy pounds, Australian dollars and euro. 

- and the last thing you have to keep in mind is that when a currency quote rises it means increasing of the base currency's value and a lower Forex quote stands for the base currency lessening.

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