Visit AvaTrade76% of retail investor accounts lose money
Visit IC Markets74-89% of retail CFD accounts lose money
Visit Pepperstone74-89% of retail investor accounts lose money when trading CFDs
Visit XTB79% of retail investor accounts lose money
Visit Admirals76% of retail investor accounts lose money
Visit eToro76% of retail CFD accounts lose money
Visit FxPro72.87% of retail investor accounts lose money
Visit XM72,82% of retail investor accounts lose money
Visit HF Markets70.51% of retail investor accounts lose money
Visit Roboforex61.41% of retail CFD accounts lose money
The best Forex brokers for trading on the news releases (or news trading), according to our research, are:
- IC Markets
- HF Markets
We have taken the following factors into consideration when choosing brokers:
- The availability of an economic calendar.
- The availability of a news section.
- Low spreads
- Good liquidity of the markets
Is Trading News Risky?
Deciding if trading the news is risky, is something that only you can decide, though it is something that everyone looks out for, and a very popular time to trade markets regardless of if the news is good or bad. When news is released, one thing that is certain is the markets will be volatile and move in either direction during the news.
If you can interpret the news and direction of the market, then you could be left in a very good position. Just be careful because a misinterpretation could be costly, and be mindful that due to the volatility, spreads may be higher, and the possibility of slippage does exist.
Important Forex Broker News Trading Characteristics
- Guaranteed execution of pending orders: A pending order when you ask the broker to open your position only at a certain time and/or conditions. During moments of high volatility, the broker’s servers may not be efficient enough to process your order. So it’s important that the broker’s servers are fast enough.
- Low spreads: During these moments of high volatility, spreads may be wider than normal. This means that you will pay more money to open a position regarding an asset that is suffering or benefiting from news.
- No requotes: A requote happens when the price you asked for is not available, so the broker opens a position with the closest available price you have asked for. Forex brokers with a good pool of liquidity providers can usually avoid this issue.
How to Trade News in the Stock Market
With stocks there are 4 type of news you should look for:
- Earnings reports: earning reports are published periodically. When the company meets their earning expectation for the quarter (or does even better than expected), stock prices usually raise and vice-versa
- Economic News: when a company acquires a competitor, or when it invests money into something. A company investing is, usually, a good sign.
- Non-Economic News: something regarding the company that may scare the investors, for example the Cambridge-Analytica Scandal that involved Facebook. This type of news is one the most traded, because it doesn’t hit the “value” of a company, but hits the emotional side of the investors.
- Geopolitical News: not related specifically to a company. When news is negative, the markets may suffer. For example a middle east crisis, tensions among two or more countries, pandemics, etc.
Pros and Cons in Trading News
Of course, like everything else in the sector and forex trading world, there are good and bad points to come if you decide to trade the news.
- Trading the news can bring around great opportunities to enter the market just before a major move.
- Trading the news is something that can reward your study and knowledge if you follow the news on the industry. You can be prepared to make your move.
- Trading during these times is to trade during periods of high volatility. That in itself brings around an increased risk for you.
- During these times, the markets will tend to be more volatile, and with that, spreads can go higher than usual.
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