"trading forex" in Services in Mississauga / Peel Region
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Canadian insurer Fairfax Financial Holdings Ltd. In short selling, a trader borrows shares to sell, hoping to buy them back later at a lower price.
If that happens, the trader settles the loan and pockets the difference. Short sellers make money when stocks go down, which explains their reputation as vultures. Kirzner argues they help create an efficient market by moving stocks where they belong, pointing to the recent decline in share price of Research in Motion — maker of the BlackBerry — as an example.
The legendary short-seller Jesse Livermore made millions betting short when stock markets crashed in But he lost as many fortunes as he made.
In , after throwing back two drinks, he walked into the cloakroom of a swanky Manhattan hotel and blew out his brains. He was introduced to the stock market while working as a contractor in Pakistan. He built a home for a businessman who was so grateful he gave Khan a quick course on trading. So he gave it up, studied trading and for the past nine years has been focusing on buying and selling currencies.
No business will give you that freedom. He says most days a handful of people will join him in his basement and copy his trades. The people who are greedy, the people who have fear, they lose money. Copyright owned or licensed by Toronto Star Newspapers Limited. To order copies of Toronto Star articles, please go to: Star Business Journal Personal Finance. By Sandro Contenta Feature Writer. Wednesday was a good day for Fawad Khan. Big winners Canada's top performing mutual funds and ETFs over the last three months: Report an error Journalistic Standards About Us.
Pakistan , United States. My Star location Select Location. Know the risks before you invest. Kholodenko is worried that many investors nonetheless open accounts with online dealers based in the U. In the summer of , Asghar Naqvi, a year-old retired Toronto camera-store owner, went to a free introductory seminar on a Saturday afternoon. Money Plus is run by a year-old former civil engineer from Pakistan named Fawad Khan, who presents himself as a day-trading expert, and who, until recently, hosted a phone-in show on Sundays on an AM radio station.
The location of Khan's seminar isn't too promising: And there, Khan explains that, to learn those profitable strategies, you have to pay for his trading course, which consists of eight days of formal instruction, followed by a week of trading alongside him.
Khan sits in front of an array of 13 computer screens and has smaller stations for a handful of students. He says dozens of other Money Plus clients usually follow along via voice links to their homes. In person, Khan is quite forthright that he is not an investment professional, that he is not trained or licensed, and that forex trading is risky. Khan had told him, the filing says, that he would recoup the cost of the course in the first week.
But Naqvi lost money, and his losses swelled over the next several weeks. Naqvi gave Khan power of attorney over that money, and Khan made trades on Naqvi's behalf via a dealer.
Khan's statement of defence says that he never guaranteed returns and repeatedly warned Naqvi about trading risks. The filing also states that Naqvi repeatedly transferred funds to the first account without informing Khan, and lost the money himself. As for the second account, the statement simply says, "Mr. Naqvi never suffered [a]loss due to the actions of the defendants. In an interview, Khan agrees that an industry rule of thumb is probably true: Nine out of 10 individuals who attempt online forex trading lose money.
But he also says that he's taught hundreds of students, and the vast majority of them make money. Yes, he admits, some lose, but mostly because "they become fearful, they become greedy," or they don't follow his lessons properly. Some of Khan's strategies don't look all that complicated or unorthodox. For instance, he urges students to ride current market trends—an old trading mantra that dates back decades, if not centuries. If the bear is in command, you follow it," he says.
If a currency is rising, particularly on increasing volume, you keep buying. Of course, that's the opposite of what a long-term investor might do. After one of Khan's Saturday seminars in early October, Rafia Soomro, a year-old University of Toronto economics and political science student, explained to a reporter how she learned the risks of not following Khan's advice to the letter on her first real trade the day before.
The euro was trading above its minute mov-. She figured the euro had to come down, so she placed a short-sell order with a forex dealer. She is a content customer of Khan's, as is her father. At his weekly seminars and on Money Plus's website, Khan says he is not a registered investment adviser. Nor does he sell forex investments himself—he directs clients to dealers that do.
In return, Khan says, those dealers give him a small break on his own trading costs. He also specifically warns about the dangers of CFDs. The high degree of leverage can work against you as well as for you," says a disclaimer on Money Plus's website. For all that, Naqvi's lawsuit shows how oversight of a particular type of transaction can fall through the regulatory cracks.
Naqvi says he spoke to an investigator at the OSC about his case, but hasn't heard back from him. A call to the investigator and the OSC's public affairs department produces the standard response: If Naqvi wants to pursue the matter with U. You might want to think twice about trying it at home.
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Comments that violate our community guidelines will be removed. Commenters who repeatedly violate community guidelines may be suspended, causing them to temporarily lose their ability to engage with comments. Read our community guidelines here. African and Mideast Business. ETFs Up and Down. Letters to the Editor. The Real Estate Market. Quick links Horoscopes Puzzles Customer service My account. Article text size A. Open this photo in gallery: Fawad Khan leads his currency-trading seminars from a Mississauga bungalow Anya Chibis.
Published November 24, Updated May 8, You'd at least be tempted, right? Story continues below advertisement. Follow us on Twitter globebusiness Opens in a new window.
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