I am thinking of trading forex in a couple a months from now , i been practicing a lot and been saving money to open a live account, and i looking for some real help on the do’s and dnt in forex, i dnt want to get get in trouble in no way, i was thinking of setting up a forex trading robot/system to help with trades, is that legal, and if so what is illegal to do in the forex market, and im also looking for a US based forex broker, any suggestions on who to go with, plz only professional forex traders only, it would be great help

I am not a forex pro, and I doubt anyone else answering this question is either. However, let me give you some advice:

Playing Forex can appear alluring, but the majority of people who try it lose money. All you have to do is do a web search on the words "Forex" and "lose" to see this is the consensus.

Forex is what we call a "zero sum" game. You are making a bet with someone else about whether a currency will rise or fall. For every winner there has to be a loser. If you are smarter than the average player, you may make money. If you are dumber than the average player, you are likely to lose money. Most of the people making the "bets" in Forex are highly trained professionals at banks and other institutions. You are unlikely to beat them at this game.

Actually Forex is not quite a zero sum game. It’s a slightly negative sum game as the Forex broker takes a small percentage each time in the spread. It’s a small amount but over a hundred trades, it ends up being a considerable amount of money. So the average player is likely to lose money, and remember the average player is a highly trained professional and probably smarter than you.

There is a lot of luck in Forex, and if you play it, you will have some periods of time where you make money. This is usually because you are having a lucky streak, not because you have suddenly become an expert Forex player. However, most people are unwilling to admit their success is due to luck. They become convinced they have a system that works, and lose a lot of money trying to refine it.

Further complicating the problem is the large number of Forex scams on the internet. Most Forex websites are of questionable honesty. You will find many people on the Internet that claim they made a lot of money using Forex. They are usually liars trying to make money. They will say: "Go to Forexcrap . com/q2347." The "q2347" is a signal to the Forexcrap site that you are being referred to them by "q2347." If they sell something to you, "q2347" gets a kickback. These coded signals can be hidden by different methods in the link. Other people will refer you to their own private website or blog for the purpose of trying to get money off you. Also there are a good number of trolls out there that like to pretend they are successful forex traders just for the fun of it.

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Pls gimme the detail information about Contract Size, n what is that for?Thank you

In forex, it’s called lots. You have 3 different lot (contract) sizes — Standard, Mini and Micro. A standard lot is for $100,000, so if you traded 1 standard lot, you’re trading $100,000 of currency. A mini lot is $10,000 and a micro lot is $1,000.

In a nutshell the lot (contract size) is telling you how much currency you’re trading in that lot. Hope this helps.

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Hello,

1. I am NOT US citizen or Green card Holder
2.I HAVE NOT Lived in United States for 182 or more days in a particular year.
3.I am Indian citizen and Resident

But, I am trading Options, Futures , forex in US markets using US brokerages.Also, I signed the W-8BEN form with the Brokerage.

Do I need to pay taxes for my capital gains from trading futures ,options ( NOT INTEREST EARNING SECURITIES like bonds or dividends ) to the IRS , united states???

I am NOT talking about paying tax in my Home country.I know, I need to pay tax in India. But, Do I need to pay taxes in United states???

Thank you.

The tax implications for a foreign investor will depend on whether that person is classified as a resident alien or a non-resident alien. To be considered a non-resident alien, a person must meet several guidelines. First of all, the person cannot have had a green card at any time during the relevant tax reporting period and cannot have resided in the U.S. for more than 183 days in the past three years, including the current reporting period.
However, non-U.S. citizens who hold green cards and have been in the U.S. for more than 183 days are classified as resident aliens for tax purposes and are subject to different guidelines than non-resident aliens.

If you fall under the non-resident alien category and the only business you have in the U.S. is in investments (stocks, mutual funds, commodities) within a U.S. dollar-denominated brokerage firm or other agent, you are subject to the following tax guidelines. In terms of capital gains, non-resident aliens are subject to no U.S. capital gains tax, and no money will be withheld by the brokerage firm. This does not mean, however, that you can trade tax free – you will likely need to pay capital gains tax in your country of origin. In terms of dividends, non-resident aliens face a dividend tax rate of 30% on dividends paid out by U.S. companies. However, they are excluded from this tax if the dividends are paid by foreign companies or are interest-related dividends or short-term capital gain dividends. This 30% rate can also be lower depending on the treaty between your home country and the U.S., so it is important that you contact your brokerage firm to verify the rate. If you are a resident alien and hold a green card or satisfy the resident rules (183 days), you are subject to the same tax rules as any U.S. citizen.

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