100400 US FX MOD2 3ED · 2 Module 2: Dealing online PureDeal: our online dealing platform Our Forex trading service is available 24 hours a day over the telephone, via our dealers,

Dealing online

Module 2Dealing online

In this module we look at how to place a trade online, how to create your own price lists and other basic features of our dealing platform.

TradeSense US, April 2010, Edition 3

2 Module 2: Dealing online

PureDeal: our online dealing platform

Our Forex trading service is available 24 hours a day over the telephone, via our dealers, or online via our PureDeal platform. Trading over the telephone allows you to ask our experienced team of dealers any questions that may arise when placing a trade, and a good deal of our clients enjoy the friendly and efficient telephone service that we offer. *

These days, greater numbers choose to deal online, however, taking advantage of the many benefits it offers.

When you first log into PureDeal, the screen is split into four specific areas, as shown.

All windows can be toggled on or off by using the buttons that appear at the top of the screen. ‘Finder’, ‘Watchlists’, ‘Open Positions’ and ‘Working Orders’ are selected as a default, but there are other options that can be selected to offer you further functionality.

The ‘Watchlists’ pane at the top shows a list of our more popular markets. The ‘Finder’ pane on the left is used to navigate to any of our thousands of markets, which can then be displayed as streaming exchange rates in a ‘Prices’ pane. From any live rate that you are looking at you can open a deal ‘Ticket’ (with which you can place an order. We also offer ‘One–click Dealing’ which is explained later in this module). You can also choose to add your favorite markets to your own personal Watchlists up to a maximum of five Watchlists. Let’s look at an example of placing a market order online.

* Please note we offer an execution-only service

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3Module 2: Dealing online

Working Orders


Looking at a chart of EUR/USD you decide that the recent trend of the euro strengthening against the dollar is set to continue, especially in light of weak US GDP data. Buying EUR/USD would allow you to profi t if the euro strengthens against the dollar. You decide to go online and check what price we are making for EUR/USD.

To access the EUR/USD rate, you need to navigate to it in the ‘Finder’ section of PureDeal. All rates that we quote are contained within the navigation tree. As EUR/USD is one of the major currency rates, it can be found by expanding the

‘Major FX’ directory (clicking on the + sign next to ‘Major FX’ achieves this). Note that a ‘Major FX’ directory exists in both ‘Standard Forex’ and ‘Mini Forex’.

Clicking on ‘Spot FX EUR/USD’ reveals a dropdown menu, off ering you a choice of functionality.

Example: buying EUR/USD using PureDeal


Selecting ‘Deal Ticket’ from the dropdown next to a market’s name enables you to place an order (an instruction to buy or sell at the current level). As you have selected ‘EUR/USD’ from the ‘Standard Forex’ directory, any order that is placed with a deal ‘Ticket’ opened from this section will be dealing in standard contract sizes. In order to deal in mini contract sizes you would need to select ‘EUR/USD’ from the ‘Mini Forex’ directory.

If you want to just view the rate without launching a deal ‘Ticket’, you can select ‘Show in Prices’. This lists the EUR/USD rate by itself in a ‘Prices’ pane. Perhaps more useful is to view a group of rates. If you click on the directory name of ‘Major FX’, every rate in that directory is displayed in a ‘Prices’ window.


This allows you to monitor a handful of rates at once. The current bid and off er (underneath ‘Sell’ and ‘Buy’ respectively) are displayed, along with other useful pieces of information, such as the net change on the day and the day’s highest and lowest prices for each currency pair.

Clicking on the green button above a rate’s name or anywhere on the ‘Sell’ or ‘Buy’ boxes launches a ‘Ticket’, from which you can place a market order.


This deal ‘Ticket’ is populated with the current rate and allows you to enter the details of the market order that you would like to place.

The bid (1.33785) and off er (1.33805) of the current rate appear in the ‘Sell’ and ‘Buy’ boxes, respectively and update constantly. As you can see, the big fi gure of the rate (1.33 in this case) is displayed in a smaller font. You can also see that the rate is quoted to fi ve decimal places. The extra fi nal decimal place that arises from precision quoting is displayed in a smaller font. For convenience, the width of the spread (in pips) is displayed in between the ‘Sell’ and ‘Buy’ buttons, so that you can see how much it is at a glance.

To place a trade you fi rst need to specify the size in which you would like to deal, in other words the number of contracts.

You choose to trade one contract (worth €100,0000): you enter 1 in the ‘Contracts’ box.

The bottom half of the deal ‘Ticket’ is an optional section off ering the ability to attach further dealing instructions; this is covered in detail in Module 3.


Making up your mind that you are happy to deal at the price that is showing, you click on ‘Buy’.

You receive an acceptance message that confi rms the trade you have placed (please note that it is possible for deals to be rejected. The vast majority of deals – over 90% – are accepted, however).

The acceptance message includes the details of your trade, along with a reference number; you should always check that all the information about your deal is correct and make a note of the reference number.

You have bought 1 contract of Spot EUR/USD at 1.33805.

You have bought €100,000 and sold $133,805 (€100,000 x 1.33805 = $133,805).


As soon as your deal has been accepted, your position appears in the ‘Open Positions’ window.

The whole time that your position is open, it is possible to check the profi t/loss of the position by looking at the valuation in the ‘Open Positions’ screen.


You hold your position for over two weeks, but the euro never really strengthens in the way that you had anticipated and eventually the dollar starts to make some gains against the euro.

16 days after you opened the trade, you decide to cut your losses. Checking the rate online, you see that we are quoting EUR/USD at 1.33168/1.33188. You decide to close your position.

To do so, you need to deal in the opposite direction to your open position. If you deal in the same size as your open position, you will close the whole trade.

The quickest way to do so is to open a ‘Close Position’ screen. This is a special type of deal ‘Ticket’ that ensures you are dealing in the direction that is required to close an open position (as you can see only the ‘Sell’ button is active in this case) and also pre-populates the correct transaction size in order to achieve a complete close. The ‘Close Position’ screen is opened by clicking on the green button (or the market name) of a position in the ‘Open Positions’ screen. To help you, your running profi t/loss for the position in question is displayed (which updates with the changing price).

You click on ‘Sell’.

Closing your position


You receive another confi rmation back telling you that you have sold one contract to close at 1.33168.

Your loss, before taking into account interest adjustments, is calculated as follows:

Opening transaction= €100,000 x 1 contract x 1.33805 = $133,805

Closing transaction = €100,000 x 1 contracts x 1.33168 = $133,168

Loss on trade = $133,805 - $133,168 = $637

To arrive at the overall loss on the trade, we also have to consider the adjustments made for interest.

You held your position for 16 days and were long euros and short dollars. With the European Central Bank rate higher than the the Fed rate, you receive more for being long euros than you pay for being short dollars, so that each day would result in a net interest credit on your position. This might amount to $26 credit over the 16-day period.

Your overall loss is therefore $637 - $26 = $611


So far we have looked at placing orders from a deal ‘Ticket’. PureDeal also off ers ‘One-click Dealing’ which allows you to deal on markets directly from prices, when in the pairs mode without needing to open a deal ‘Ticket’.

To disable/enable ‘One-click Dealing’ you need to go to the ‘My Account’ section, which can be accessed by clicking on ‘My Account’ in the top right-hand of the screen (as a default your account is set to having ‘One-click Dealing’ enabled).

In order to disable ‘One-click Dealing’ you need to click on ‘Preferences’ within the ‘Settings’ section and then switch ‘One-click Dealing’ to ‘Don’t allow One-click Dealing’, before fi nally clicking on ‘Set Preferences’.

Using PureDeal: ‘One-click Dealing’


When ‘One-click Dealing’ is enabled each pair shows a fi eld where you can specify the size of the deal.

If you enter a deal size in this fi eld, the ‘Sell’ and ‘Buy’ buttons become dealing operational as shown.


Now if you click either ‘Sell’ or ‘Buy’ you will directly initiate a deal.

‘One-click Dealing’ makes it even quicker and easier to place a trade than normal, especially if you pre-fi ll in the number of contracts or shares in which you intend to deal, but you should take care if this setting is enabled. With the intermediate step of the deal ‘Ticket’ removed, you should be cautious not to accidentally place a trade.

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Using PureDeal: list view

We also off er an alternative way of viewing prices. In the previous examples, the prices were viewed as pairs. There is another mode in which you can view prices as a more straightforward list as shown (you can select the viewing mode using the ‘View as’ dropdown menu).

‘One-click Dealing’ is only available in the ‘Pairs’ view; the ‘List’ view lays out information such as the high, low and time of last update in a more spacious manner. Both views display the same data, just in visually diff erent ways: feel free to go with whichever is your preference!


PureDeal allows you to set up your own lists, so that you can easily view your favorite rates.

Setting up a new Watchlist is easy: click on ‘+New Watchlist’ in the ‘Watchlists’ pane in the bottom left hand corner of the screen.

This launches a window that prompts you to enter the name of your new Watchlist.

Using PureDeal: creating a Watchlist


Let’s say that you want to set up a list showing the euro against other major currencies, to make it easier to keep on eye on how the euro is broadly performing.

You can set the Watchlist name as anything of your own choosing (up to 20 characters), so this time you type in ‘Euro vs Majors’ and click ‘Submit’.

The name of your new list immediately appears in the ‘Watchlists’ window.


You can rename the Watchlist at any point by clicking on the pencil icon and any new list that you create can be deleted by clicking on the trashcan icon. A Watchlist is launched by clicking on its name, so that you can view the rates in the list.

To add a rate to a Watchlist you click on a specifi c rate in the navigation tree and select ‘Add to Watchlist’ (you can also do this by clicking on a rate in a ‘Prices’ pane).


This launches a window that allows you to specify to which Watchlist you would like to add the rate. As a default a ‘My Watchlist’ always exists, but you can create up to four additional Watchlists.


You select ‘Euro vs Majors’ and click submit and then repeat this process for all the currencies that you are interested in adding to the Watchlist.


Launching the new Watchlist now shows rates for the euro against all the majors and you can now easily launch ‘Tickets’ for both mini and standard contracts. The order in which rates are displayed can be rearranged to your liking by ‘dragging and dropping’ (click any blank space on a row in order to drag).

You can also select which Watchlist you are viewing from the dropdown at the top of the ‘Watchlists’ pane.

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SummaryBy now you should:

Know how to search for rates online

Be able to open and close a trade using PureDeal

Understand ‘One-click Dealing’ and know how to switch it on or off

Know how to set up your own Watchlists

Please remember that our Forex Trades are a leveraged product and can result in losses that exceed your initial deposit. Trading Forex with us may not be suitable for everyone, so please ensure that you fully understand the risks involved. You should of course note that, without proper risk management, a high degree of leverage can lead to large losses as well as gains.

IG Markets

311 South Wacker Drive

Suite 2650

Chicago IL 60606

US Toll Free: 866 748 1340www.igmarkets.com/fx

Documents

100400 US FX MOD2 3ED · 2 Module 2: Dealing online PureDeal: our online dealing platform Our Forex trading service is available 24 hours a day over the telephone, via our dealers,