Quizzes 33 to 36

Leverage defines?

A) The risk in a trading account
B) it has nothing to do with trading
C) the volatility of a currency pair
D) none of the above

Wrong answers include b) it has nothing to do trading. C) the volatility of a currency pair, D) none of the above.

The correct answer is A) the risk in a trading account. This is because Forex brokers allow you to trade with more money than you have in your account. While this can increase profits, it can also increase losses.

The bigger the spread?

A) The better for the trader
B) the better for the broker
C) the more attractive the currency pair is
D) the less attractive the currency pair is

The wrong answers include a) the better for the trader, and c) the more attractive the currency pair is. By having a larger spread, a currency pair is more difficult to make profits with.

The correct answers are b) the better for the broker, and d) the less attractive the currency pair is. This is because the broker typically makes its money by charging the spread, and of course the higher the spread the less likely the trader is to profit.

Scalping refers to?

A) Trading with a very short-term perspective
B) trading for a very small profit targets
C) trading without a plan
D) none of the above

Wrong answers include c) trading without a plan, and d) none of the above.

The correct answers include a) trading with a very short-term perspective, and b) trading for very small profit targets. Scalpers typically are in and out of the market quite rapidly, taking small pieces of the market with them.

A pending order shows the intention to?

A) Buy a market
B) sell a market
C) buy or sell at future price levels
D) none of the above

Wrong answers include a) buy a market, b) sell a market, and d) none of the above.

The correct answer is C) buy or sell at future price levels. A pending order simply means that you are looking to get into the market once certain conditions are met in the future.

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