--------------------------------------------- Issue 2-
HYIP NEWSLETTER - stay up to date in the hyip world!

http://www.hyipinvestment.com
http://www.hyipdiscussion.com
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DISCLAIMER: All information in the HI Newsletter is neither an endorsement nor a solicitation of any sort and cannot be considered as a promotional offering. We do not provide free professional consulting on investment options or personal assistance with recovery of deposited funds.
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in this issue:

1. News on most popular programs
2. FOREX. Introduction
3. Recommendations from a professional FOREX trader. Part 1

News on most popular programs

PIPS (People In Profit System): PIPS-USA has reached an agreement with a travel agency, according to which PIPS members can pay for their vacations with PicPay. Non-US citizens are also eligible, but will be charged an 8% fee (payable with PicPay as well). One more thing to be mentioned here is the eligibility of foreigners to join PIPS-USA at any time for a one-time entry cost of US $100.

Global Mutual: GM is experiencing minor difficulties with crediting members' accounts via StormPay and PayPal. Members are encouraged to contact the company's customer support service for a prompt assistance with any problems concerning the crediting of their accounts.

Reality Millions: RM's non-risk guarantee on investments has resulted in a substantial dispute among the program's members. Withdrawals are currently four weeks behind the schedule.

StudioTraffic: The recent system upgrade has caused problems with withdrawals from StudioPay to members' bank accounts. However, the company resolves these issues in a fast and effective manner.

International Trading: The program has stated its inability to work with E-gold in the future due to an insufficient amount of monetary mass offered by this e-currency. This issue is subject to numerous discussions on investment forums.

You can discuss these and many other programs with fellow high-yield investors on our forum at http://www.hyipdiscussion.com

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FOREX. Introduction

The word "FOREX" is an English abbreviation of "Foreign Exchange Operations". This kind of business operations constitute a significant part of the global financial market. The circulation of the US stock exchange with the total volume of 300 billion dollars is less than the one of FOREX by three times. According to The Wall Street Journal, only in September, 1992 this volume totalled around 1 trillion dollars per day. The present-day image of FOREX is a direct result of the 1973 events when European countries switched to floating rates of their currencies. This historical event has provided an opportunity to estimate the real value of currencies of the leading world's countries. In other words, demand for currencies was suggested to correct their supply.

It is not difficult to guess what the dominating currencies which constitute the main value of FOREX are. These currencies are serve as a "business card" of their countries, dictating "the rules of the game" to the rest of the world. They are British Pound, Swiss Frank, Japanese Yen, Euro (which has recently substituted German Mark), and, of course, American Dollar. Actually, FOREX is not a market in the traditional meaning of this word. It doesn't have an actual physical location - as opposite to, let's say, currency futures. All trading is conducted by telephone and via computer terminals at the same time all over the world. Another significant difference is based on the fact that this market never closes - it functions 24 hours per day, 7 days per week throghout the entire year. There are always dealers in any of the five time zones (London, New York, Tokyo, Hong Kong, and Sydney), willing to exchage currencies. Another plus of FOREX is the ability to use the concept of marginal trade. For instance, to conduct an operation with US $100,000 all you need to do is to deposit the amount of money equivalent to 1-10% of the contracted amount. This principle is known as "marginal leverage". Nowadays, the most popular marginal leverage among FOREX traders is 1:100.

The cast of FOREX traders is extremely diverse: banks, international corporations, brokerage companies, small firms, and private investors. A huge number and variety of financial institutions allows to choose the most convenient way of conducting operations and to pick the optimal conditions - such as sum of your deposit, minimal transaction amount, marginal leverage, commission etc. In order to realize the forces ruling FOREX, careful attention has to be paid to the countries it was created by and whose currencies are now traded on it. As we have pointed out above, a country's currency plays the role of its "business card" - hence, the actions of countries determine the value of their currencies on FOREX. The key factors of these actions are economy, internal and external politics, and central banks. The high liquidity of FOREX is the aspect which attracts investors to it - however, everyone should keep in mind that the risks being involved are extremely high as well. To make it simple: you can make a fortune out of practically nothing within seconds, but you can also lose your entire deposit in the blink of an eye.

There's no racial or sexual discrimination on stock exchange and currency markets. New York Stock Exchange (NYSE) will always remember Muriel Zaberth - the first woman to obtain her own portal on NYSE who later became a multi-millionaire and funded a large brokerage company in the United States. The main task of any currency trader is the purchase of currencies at low rates and reselling them at higher rates.

Let's say you are purchasing Japanise Yen at the rate of 109.7 to 1,000 US Dollars. The result is multiplied by the value of your marginal leverage (1:100): 109.7*100 = 10,970 Yen. Let's say, after this the rate of USD falls to 109.3 Yens per 1,000 USD (to make it simple: Yen has become more expensive). In order to complete the operation, you re-purchase your initial US $1000 and keep the difference in Yens as your pure profit.

To sum it up: when Yen was cheap, we purchased a certain amount of this currency for USD. As it has grown in price, we re-purchased the initial amount of USD we had spent, and kept the difference in Yens. Such situations occur on FOREX practically every second. To gain some parctical knowledge and practice in this plan, we encourage our clients to open a demo account with one of online dealing centers, and start learning in conditions similar to the ones of FOREX.

But how do we know when and what currency we should purchase and when we should sell it? Your decision should be based on a number of factors. For this purpose, we have invited a member of HyipDiscussion.com under the username "hyi-center.net" to share his knowledge and experience of a professional FOREX trader with our subscribers (see the article below).

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Recommendations from a professional FOREX trader. Part 1

1. Money Management: Money management is a critical point that shows
difference between winners and losers. If 100 traders start trading using
a system with 60% winning odds, only 5 traders will be in profit at the
end of the year.
95% of traders will lose because of their poor money management. Money
management is the most significant part of any trading system. Most of the
traders these days don't understand how important it is, their emotions
and greed get the better of them resulting in a depleted account.
It's important to understand the concept of money management and
understand the difference between it and trading decisions. Money
management represents the amount of money you are going to put on one
trade and the risk your going to accept for this trade.
As with HYIP's, never spend any more than you are willing to afford to
lose, adopting a similar strategy via forex proves to be beneficial over
time.
For instance; Your starting capital may be $1,000.00, risking 10% of your
balance on one currency pair or HYI Program leaves you with $900.00 to
recover if this Trade, or HYI Program goes against you - choosing to go
any higher than this you face problems later as it's much harder to regain
what was lost with a smaller balance. Trading 10% of your balance is not
recommended on a single trade, 1-5% is surfice (depending on balance
size), especially when your account is on one of the higher leverages your
broker offers you . A small gain here and there soon adds up over a period
of a year.

2. Risk Managment/Leverage: Risk Management & Choosing which Leverage to
take on is another form of Money Management. Before taking on the Currency
Exchange Markets obviously you need to Open a live account first, unless
of course you're a beginner a Demo Account is highly advisable to get a
feel of what you're actually letting yourself in for. A majority of FX
Brokers let you start at 100:1 leverage and work up to 400:1. For any
beginner I advise not to choose these brokers and consider choosing Oanda
(http://www.oanda.com). Oanda offers 10:1 to 50:1 leverage.
As your experience grows choose another broker and opt for 100:1 leverage
with a tighter risk management to compensate for the higher risks involved
and increase the risk ratio as you feel more confident, but never go over
board, consistancy is the key here and in keeping in check of your
emotions regardless if you win or lose big.

What is leverage?
10:1 leverage on a $1,000 opening balance is equivalent of controlling
$10,000. 100:1 leverage means you control $100,000.00 worth of open
positions which in general terms means you can earn a whole lot more for
less of the purchase price of the trade. The lower the leverage the more
the Trade will cost, for instance: 10:1 leveraged account for one lot may
cost $10,000 for a $10 per pip. 100:1 leveraged account for one lot may
only cost $1,000 for $10.00 per pip. Huge difference eh? This is why it's
so important to practice money management first as it's easily to get
really greedy from this point on. Most traders when they start out for the
first time will opt for the highest leverage they can obtain and do
something silly like opening a trade for $10,000 cost for $100 per pip not
realising the disadvantage it has should the trade go against them. They
may only have $15,000 in their account leaving $5,000 left as margin (50
pips @ $100 per pip) as room to breath in before being cleaned out. Once
this is used up 1% or less of the cost of the price of the trade is given
to breath (1 or 2 pips) before you're margin called.
So by using Oanda to learn from, you can be something like 100 or 200 pips
down with no margin left and still be ok with a 10:1 leveraged account.
It's like a little insurance policy on the trade, lower the leverage more
you pay insurance on to protect your initial balance/equity.
I've actually traded 400:1 leveraged accounts and still do but only for
NFP Trading (Non-farm payrolls) and earn anything from 20-50% on that
single day alone (once a month), compounded on balance which equates to
around 200-400% profit each month on the Net deposit.

What is Risk Management? Risk Management is actually setting your limit
and never going against it, it takes a lot of self discipline. Trading 1%
to 5% on a single trade of your balance size is advisable and diversifying
your trades with 2 open positions at any one time. Counter balancing with
diversfication on another currency pair that moves in the opposite
direction. Some have adopted the Correlation Technique, closing one at a
loss while closing the other at a higher gain to leave an overall profit
no matter how large or small. Limit your losses and maximise your gains.
Lock in your profits via stop losses or "trail your stop losses" to book
in more profits as they are made, there is nothing worse that seeing
50-100 pip gains to find later you've got yourself some lunch or a cup of
tea to notice this has all gone in the time it took to get yourself some
lunch.
Here's a good site to see this in action to choose which pairs to take on
before hand: http://www.mataf.net/en/analysis-correlation_id.htm

3. Forex Signal Providers: I've seen a lot of places that offer these type
of services and 9 out of 10 of them never keep up the consistancy of
profitable trades. My only advice here is if you start to notice a
provider of such service and not performing as advertised, try not to be
dismayed by the bad results. Actually stay with them if they are really
bad and do the opposite of what they predict. <wink>

[To be continued in the next editions of our newsletter, which from now on will be issued on a weekly basis. Make sure you check your mailbox every week!]

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