The changing needs of the market participants usually stimulate the growth of new trends in trading. The more advanced traders get, the more they seek opportunities to refine the strategies and tap into opportunities that standard currency pairs may fail to capture. Synthetic forex pairs are also rapidly emerging as many begin to appreciate their adaptability and flexibility; there is a new dimension in customisation that enables traders to have a closer alignment of position to their perceptions of the world markets.
Synthetic pairs are basically tailored currency pairs in which traders or sites create them by setting up two distinct trades into one synthetic pair. This enables the traders to form cross-currency positions which do not directly feature in the traditional platforms. It also allows exposure to certain currencies and still retains a presence in the greater forex market. Such advantages have made synthetic pairs especially enticing during periods of enhanced market volatility or when there are economic stories affecting some areas more than others.
A forex Broker in Singapore is responding to this trend by improving the capabilities of its platforms and implementing the education of traders as to how to operate with the synthetic pairs to great effect. Instead of keeping them as niche tools, these brokers will be incorporating them into the broader set of offerings available, thus it will be simpler to use them and get information about them. The idea is to make traders more in charge of the ways they manage their risk and strategies, and they do not have to run to fill in complex calculations by hand or third-party applications.
The technology that the platforms require is also one of the biggest adaptations. Brokers are overhauling the interfaces to allow synthetics to be created and tracked the same way as regular pairs. These are live pricing, order execution, charting and analytical assistance. Brokers facilitate the reduction in the learning curve by introducing the synthetic pairs through a medium that the traders will be familiar with so that when the traders move to the use of these instruments they may do so with ease.
Traders have a big responsibility to ensure that they maximize this aspect and education comes in handy. A growing number of brokers are providing tutorials, strategy sessions and simulation systems that show how synthetic pairs may be used to hedge, speculate or diversify. Examples of these resources include real-life situations in which synthetic trades can produce an advantage, i.e. it is possible to avoid wide spreads in exotic pairs or hedging against exposure to an individual base currency.
It offers more sophisticated strategies to be applied by traders which can be based on identified trends worldwide, not just the commonly traded ones, as is often the case among inexperienced traders. This reason alone makes synthetic pairs an essential component of a serious trading strategy. The precarious part of the situation is that, to the brokers, it is necessary to make such tools familiar and apparent, so that their users understand their functions and associated risks.
A forex broker in Singapore that is able to make this change is not just adding features to its platform; it is also an indicator that they are willing to expand with the market. With increasing preference to trade in more healthy tools and the desire being acknowledged by many to trade in synthetic forex, offering and supporting such features would provide a competitive advantage. This way, brokers will serve a wider scope of trader types, including those who are merely seeking greater accuracy and those who are simply interested in hedging particular exposures.
The emergence of synthetic pairs is only one way through which forex trading is ever-changing to develop new innovative concepts. By adopting such changes, brokers assert their position as guides along the trader path in not only supplying the instruments but also assisting throughout an increasingly complex trading landscape.