# What Does Finance Rate APR Mean?

You take out a loan and then you see these big, bold letters: APR. What does finance rate APR mean? We know the terms can be confusing. So we will try our best to spell it out for you in a manner that’s easy to follow and understand. Simply put, APR means Annual Percentage Rate or the interest rate you will have to pay for the whole year.

Legal Requirement

Most lending products like loans and mortgages are required by law to publish the APR. This is because the APR is a better way for loan makers to assess a potential loan. Loan makers can easily evaluate and compare different loan offerings through the APR. While most countries are strict about APRs, some do not require them to be published. Other countries have different interpretations of APRs too. For the purpose of this article, we’ll stick with the simple APR concept.

Monthly Interest Rate Vs. APR

Your monthly interest rate is the amount you pay every month together with your loan principal. The Annual Percentage Rate, however, is the rate taken by adding up the amount you have to pay per month for the whole year. Let’s look at an example to illustrate this further.

Example

Let’s say you took out a \$120 loan with a 2% monthly interest rate. And this loan has to be paid back in full in twelve months. This means:

Monthly Rate for Principal: (\$120/12) = \$10
Monthly Interest Amount: (\$120 x 0.02) = \$2.4

If you add up both amounts you get \$12.4 as the amount you have to pay to your creditor per month. These two figures only paint half the picture. It’s dangerous to make a loan decision on the basis of thinking that 2% or \$2.4 dollars is a small amount. Yes, it’s smaller now, but wait till it adds up. By adding \$2.4 monthly, this is your APR.

APR=Monthly Interest Amount x 12
Loan Amount

Which means:

APR= \$2.4 x 12
\$120

Which gives us:

APR=24%

Summary

It’s better to compare loan rates when you consider the APR and not just the monthly interest rate. It gives a better indication of just how much you have to pay in the long run. If you look at our example, a 2% monthly interest rate can mislead a lot of people, especially if they don’t calculate how much they will be paying if they their loan drags on. But if they see 24%, they’ll know right away the extent of the cost of their loan.

Take note though that APRs also include fees and other charges that are associated with making a loan. The best way to go about loans is to ask the creditor how the APR is computed. They will be more than happy to assist you with this request.

So get to know what an Annual Percentage Rate is, as opposed to the Monthly Interest rate. With current interest rates getting higher, it pays to be careful with the figures before committing to a loan.

Did we answer your question on what does finance rate APR mean?

# Best Forex Trading Course For Dummies

The Forex trading system is one of the high risk forms of investment. This is the reason why any beginner who is planning to engage in this type of business must study, read and familiarize himself with the best Forex trading course.

Knowing the ins and outs of forex trading will carry you a long way. Otherwise, you will find yourself lost in a financial maze.As a beginner, it is normal that you want to invest in the best trading course or system to study or to follow.

Here are some of the lists:

1. Nial Fullers Forex Trading Course

This website is maintained and operated by Nial Fullers who is said to be a long time forex trader and trading guru. The primary focus is on the idea or concept of Price Action Trading and forex trading strategies which revolve, focus and base one’s forex trading decision on the price chart.

The price chart simply indicates the movement of the price of the market over a certain or variable period of time. It can also be caused by the fluctuation of price of currencies in the market.

There are also variousarticles concerning forex trading posted on the website that one could read and consider. The website has various segments which also offer free videos, strategies; trade setups, forex trading course, beginner’s lectures, forum and archives.

2. Baby Pips

Baby Pips.com is another website you might want to consider. It features School of Pipsology, blogs, forums, tools and Forexpedia.

The School of Pipsology aims to help you acquire everything you need to know about how to become successful in the forex trading business. Its blog is aboutforex trading updates. The forum is the place for discussion of members about forex. The tools are all about the major forex economic calendar or time table; while the Forexpedia is the archive or the free forex encyclopedia where one could browse.

3.  Forex Time

ForexTime.com gives the beginners a chance to learn the basic of the forex industry, and how you could become a forex trader through its educational tools and learning materials. You need to register on the website to avail of this offer. Forex Time also provides a Live Chat between its customers and representatives.

4. Dummies.com

This websites features the mini-book “Currency Trading For Dummies Getting Started Edition” by Mark Galant and Brian Dolan. It is composed of 46 pages.The mini book is divided into four chapters:

Chapter 1: What is the Forex Market?

Chapter 2:  The Mechanics of Currency Trading

Chapter 4: Getting Started With Your Practice Account

5. Go Currency.com

Go Currency.com features an article about forex trading for beginners. All other aspects of forex trading such as Currency Converter, Currency Exchange and Currency Tradingare also included.

6. ForexFactory.com

Forex Factory provides a free eGuide on Traits of Successful Traders. Interaction among its members are enhanced through its forum. Its Trade segment provides Trade Feed/Live Accounts.Calendar of ForexTrading is provided, as well as, news updates on the forex market and brokers.It has been said that only 4% out of 100% forex traders belongs to the successful forex traders while the remaining 96% failed.

For you to be able to belong to the small winning circles in forex trade market, you must learn, master and put into practice the entire best forex trading course or best forex trading systems.  There is no short cut to success when it comes to Forex Trading. It is the survival of the fittest.

# How To Day Trade Forex: Mistakes You Have To Avoid

Serious money can be made if you know how to day trade Forex. For the uninformed, Forex refers to the Foreign Exchange Market—a market where the world’s currencies are traded. It is also called FX or currency market. As for a day trader, these are the guys who do the buying and selling in a given holding period. The exchanges or transactions only happen in the morning because the market closes at noon (hence the term ‘day trading’).

We begin your Forex day trading crash course not with lessons on what to do, but with tips on what mistakes to avoid.

MISTAKE #1: Averaging Down

Averaging Down is a Forex trade strategy where the trader lowers the average entry price of a trade for fear of accepting a losing trade. By averaging down, contracts of a lower price are added into a trade. This move effectively lowers the average entry price of those two contracts packaged as one. By doing this, the trader is holding a losing position. Huge capital is lost when averaging down. And the trader will be hell bent on gaining back the losses in every other trade he makes.

MISTAKE #2: Acting Hastily Before News Announcements are Made

News events have a great effect on the market and can cause surges or drops in rates. When rumors of an impending news event come out, a lot of inexperienced traders jump the gun and make purchases or buying decisions based on pure speculation. This rookie move has the potential to cause the inexperienced trader huge losses.

MISTAKE #3: Joining the Bandwagon

As a corollary to number 2, this mistake is when news hits and the trader moves together with market to ride the wave of surges. But this can easily backfire because the market is known to swing back and forth. This volatility doesn’t manifest itself after some time. So it’s best to wait for the market to stabilize before making a trade.

MISTAKE #4: Risking Too Much Capital

In Forex trading, it’s been established that excessive risk can lead to excessive losses in the long run. There’s a rule of thumb for Forex day trading that no more than 1% of a trader’s capital should be risked for a single trade. It is therefore advised that traders don’t gamble too much on risking their capital for a single trade, no matter how good it seems on paper.

MISTAKE #5: Being Unrealistic

A day trader should cultivate the habit of being realistic. They need to understand that the market is volatile and can act in an illogical manner at times. By being realistic, a trader will do his best to become disciplined and not be swayed by emotions. They also need to realize that they cannot be winners in all their trades. They just need to make sure that their winning trades outnumber their losing ones.

The tips above should give you a clearer picture on how to day trade Forex. Avoid these five mistakes at all cost and you just might make a good living for yourself trading currencies.