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High Risk Investment Warning: Trading Foreign exchange (forex), CFDs and commodities on margin carries levels of high risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. The information provided by FairMarkets to you is of a general nature and does not take into account your personal circumstances and financial objectives. Before deciding to trade Foreign exchange, CFDs and commodities, you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all risks associated with foreign exchange, CFDs and commodity trading, and seek advice from an independent financial advisor if you have any doubts.

FairMarkets Trading Pty Ltd. is a company registered and regulated in Australia by ASIC (Australian Securities and Investment Commission) and holding AFS license number ACN  

* Spread refers to the difference between the lowest ask price and the highest bid price. Spreads can be affected by a variety of factors including but not limited to market volatility, available liquidity, trading session, and order size.
** Execution speed refers to the time between when your orders are received and filled by FairMarkets. Speed can be affected by a variety of factors including but not limited to available liquidity and market volatility.
*** Leverage varies depending on the product offered. Please find our full trading specifications on our MIS documents.

LEGAL DOCUMENTS

Please check Financial Services Guide, Target Market Determination, Client Agreement and other legal documents here: Legal Documents

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FX Balance Sheet enables treasury professionals to measure, monitor and manage currency exposure and the associated risk from their balance sheet.

Accurate, Complete and Timely Data

For treasury teams to effectively understand and manage corporate risk, they must have access to accurate, complete and timely data.

Kyriba provides tools to facilitate quick data mining from major ERP systems, ensure data accuracy and automate data collection. This gives treasury complete visibility into transaction currency balances, enables them to make better decisions based on the most accurate information and gives them more time to strategically analyze exposures and make risk-mitigating decisions.

A Streamlined Process

Kyriba facilitates transparency into organizational processes, helping clients understand how separate corporate levels (divisions, countries, entities) conduct day-to-day business. Kyriba highlights how local controllers are posting and clearing transactions and forecasting future business. The enrollment process facilitates an end-to-end review of internal processes — from data collection to exposure reporting — allowing for flexibility based on local requirements.

Finance Team Collaboration

Kyriba facilitates cross-functional and interdepartmental collaboration, working as a catalyst to initiate improved internal teamwork and communication.

For treasury and local finance teams, segregation of duties and an establishment of responsibilities and timelines help provide a better understanding of individual roles and how their activities contribute to the greater corporate footprint. The application’s role and field-level access controls inform treasury who is doing what and when, which serves as a critical reporting requirement in auditability and compliance.

On-demand Data Collection
• Eliminate manual time spent collecting exposure data
• Automate data aggregation, mapping and derivation

Extensive Data and Exposure Analytics
• Improve visibility into balances
• Increase transparency into internal processes

User-defined Risk Reporting
• Improve FX exposure and risk reporting
• Increase internal collaboration and FX awareness

Technology-enabled Risk Reduction
• Organically eliminate exposures
• Automate hedge recommendations

End-to-end Workflow Automation
• Eliminate manual processes and human error
• Improve efficiency and security

Informed Decision-making

Whether starting a hedging program from scratch or looking to make improvements to an existing process, Kyriba offers a holistic approach to decision improvement. Automating and streamlining the collection of complete and accurate data gives treasury teams more time to analyze the root cause of exposure and consider all available options to mitigate risk.

With the application, treasury can take advantage of complex data aggregation and display exposures at the corporate or individual entity level. Analytical tools streamline decision making and hedging processes to ensure optimal netting and hedge allocation. The application enables optimized organic exposure elimination and simplifies the hedging process, applying preset parameters to hedge recommendations with review and approvals before secure exposure or trade files are automatically sent to trading platforms or treasury workstations.

KYRIBA BUSINESS INTELLIGENCE FOR BALANCE SHEET

Business intelligence brings innovative, graphical analytics to FX Balances Sheet with robust currency exposure and risk visualization.

Kyriba’s business intelligence takes raw data and transforms it into useful business information. By having detailed, timely, easy-to-interpret information, organizations can make better, faster decisions.

The customizable dashboards, reporting and data visualization available allow treasury organizations to understand and manage currency risk in real time. Additionally, these functionalities can be used to help recognize problems before they occur, avoid losses and track currency trends for the future.

Kyriba’s business intelligence combines strategies, processes and technology to support informed business decisions. By transforming static data from spreadsheets into charts, graphs, pivot tables and dashboards, treasury can make faster, more informed decisions with visual and dynamic reporting.

What is the difference between equity and balance in forex trading? While equity is a dynamic value that reflects the changes in open trades, balance is the amount of initial funds in your trading account. Every trader should be able to understand the difference between equity and balance as they are two crucial aspects of forex trading. Fundamentally, while they may reflect the same amount sometimes, equity and balance are two different amounts.

What is Balance? 

The account balance, or simply balance, is the amount of money in your forex account. If you deposit $ into your account, then the balance will be $ The balance is not affected by your trading activity until you close your open trades. Balance doesn’t include any profits or losses that are to be realized by open trades, only reflects profits/losses from closed positions. It changes only when you deposit funds or close a trading position. Swaps and rollover fees also affect your account balance if you keep a trade open overnight. 

The balance is displayed on the MT4 trading platform in the Terminal window under the Trade tab. 

What is Equity? 

Equity reflects the current value of the trading account and fluctuates according to changes in open trades. It is the account balance plus unrealized profits/losses associated with open trades. Equity also takes into consideration the trading costs like swaps and commissions. 

For example, if a trader goes long on the EUR/USD pair and the trade is showing a floating profit of $ Let’s assume the trading balance is $ In this case, the balance would be $ while equity will be displayed as $ This amount will keep fluctuating until the trade is closed, then it will be reflected automatically on the account balance.

Related Equity Terms: 

• Balance Equity: it refers to the total funds in the trading account when there are no open trades. 
• Floating Equity: it is the future or unrealized profits and losses that are not reflected on your balance yet. This amount fluctuates as long as the trades are open. 
• Negative Equity: it happens when unprofitable trading ends up wiping the trading account. Yes, some traders may end up with greater losses than their balance. But luckily, many forex brokers offer a negative balance protection feature that helps traders avoid such incidents.  

Equity and Margin 

The margin is the amount of capital required to open and maintain trading positions. It acts like collateral that is kept aside by the forex broker in order to keep a trade open and ensure that potential losses are covered. The margin is released back into the account balance once the trade is closed. 

Free margin is calculated by subtracting the margin from the equity, and it is the available margin to open new trades. When there is no sufficient free margin to keep trades open, the trader is notified to top up the account with funds. This is known as the margin call. 

The formula for calculating the margin level is:

Equity Vs Balance Explained 

The account balance is all the existing cash capital in your account. While equity is the balance +/- unrealized profits or losses. The balance and equity are equal in case you have no open trades. 

Equity is usually lower than balance when the open trades are losing or when profits are smaller than swap and paid a commission. On the other hand, equity is higher than balance when existing trades are winning, and profits are greater than trading costs. So, equity reflects the variable value of the trading account, a real-time reflection of current profits/losses.  Sometimes it is referred to as the floating account balance. 

How important is it to track your Trading Equity?

Let’s begin by exploring an alternative definition of equity, which refers to the combined value of a trader’s forex balance and any unrealized profits or losses related to their open trading positions. Equity is a reflection of the current status of all active trading positions.

When the margin is subtracted from equity, the remaining amount is referred to as free margin, which can be utilized to initiate new trades. However, if the free margin isn’t adequate to sustain existing trades, the broker will send a notification to the trader to top up their balance. Failure to respond to this margin call will result in the broker forcibly closing all open positions if the market moves unfavorably to the trader.

The notification from brokers for traders to add funds to their accounts is commonly known as Margin Call, while the situation where brokers forcibly close a trader’s positions due to insufficient funds is called Stop Out. Margin call and stop out limits differ among brokers and are typically detailed in the specifications for a forex account. As a trader, it is crucial to keep track of your equity and free margin levels to avoid losing your trading deposit.

Forex Balance Vs Equity: What Matters Most?

Equity and balance clearly differ significantly from one another. Additionally, we now understand which one requires closer attention. Due to the vital components, it contains, failing to pay attention to your equity will only hinder your ability to trade profitably. The balance, however, does not contain any items that are important enough to influence the results of deals.

The progress of your equity will depend on how well your trading strategy and risk management concepts work together with your money management. It will also have an impact on how many trades you can execute using the money indicated in your forex balance. Due to the fact that doing so will merely bring your account closer to the stop-out level, you cannot afford to trade recklessly or haphazardly. Your equity will no longer be able to sustain additional trading activities once it hits that point, and your FX balance will be zero.

How to Open Forex Account in a Few Steps

A forex account is used to trade foreign currencies. Typically, you open an account, deposit money and then buy and sell currency pairs. Opening a forex trading account is a quite simple process these days given the growth of online forex trading. It requires some paperwork and a few security steps, such as identity verification, and all can be done online. But first, you’ll have to choose your forex broker, select an account type, register then activates your account. 

You can choose between various account types, based on your trading strategy, experience, and capital designed for investment. Choices include Standard, Cent, or ECN trading accounts. Enjoy favorable trading conditions with Aximtrade; especially when it comes to margin and leverage levels. You can control your real-time risk exposure by monitoring your used and free margin as together make up your equity. 

AximTrade provides a leverage range that helps you choose your preferred risk level. The leverage ratio depends on your account type and equity, up to infinite leverage, and can be reduced by applying custom leverage.

Follow these steps to open a forex account with AximTrade:

1. To open a forex account, log in to your member account from AximTrade login, and click on the “+ Open Extra Account” button on the top right. 
2. Choose your preferred account type. You can choose between Standard, Cent, and ECN accounts. You can also choose a demo account if you’re a beginner. 
3. Select your account and press “Open”. 
4. Name the Account and create both trading and investor passwords for your account. The investor password should not be the same as the account password. Remember to use both uppercase and lowercase letters and use a combination of numbers and letters. Then click “Done”.
5. Now your account is ready for trading. You can find all your accounts in the “My Accounts” tab. 

Join a Powerful Online Trading Platform

Experience the most reliable trading conditions and infinite leverage account with one of the best brokers in the financial markets. AximTrade is an award-winning brokerage service provider and multi assets trading platform with a diversity of financial instruments including stocks, cryptocurrencies, forex, indices, metals, and oil. The company offers top-notch technology, competitive leverage conditions, the lowest spreads, and a diversity of account types and investment capitals. Check the full AximTrade Review to learn more about the trading conditions and the company regulations.

AximTrade is dedicated to providing forex traders with easy-to-use technology, educational resources, technical analysis, varieties of forex bonus promotions, and a highly competitive trading environment with the best trading conditions.