How to Start Forex Trading in Guyana

Ready to enter the world of forex trading but don't know where to start? Look no further. If you're in Guyana and curious about how to embark on this potentially lucrative venture, there are a few key steps you need to take. With the right knowledge and guidance, forex trading can become a viable income stream for you.

The forex trading sphere of Guyana is expanding, as new loosened regulations make the foreign exchange market more accessible to everyone. The foreign exchange market reserves in Guyana hit $823 million in 2022. If you're interested in learning more about how you can trade forex in Guyana, keep reading.

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Get Started with Forex in Guyana

The rise of online brokerage accounts has made it easier for Guyanese traders to find access to reliable, regulated forex brokers. Expect to take the following steps before you begin trading.

• Check your internet connection: The most important tool a forex trader can have at their disposal is a high-speed internet connection. Before you open a trading account or start comparing brokers, run a speed test on your internet connection and be sure that your internet access is secure and private.
• Compare forex brokers: Reliable brokers operating in Guyana register themselves with the Bank of Guyana, but international options are also available. Compare fees, restrictions, leverage options and currency availability between brokers before you decide where to open an account. Then, use your broker’s online process to open your account.
• Download your trading platform: In addition to a brokerage account, you’ll also need a trading platform to trade forex. Though most brokers support popular 3rd-party platforms like MetaTrader 4 or 5, you may also have the opportunity to use your broker’s own proprietary platform if they offer one.
• Fund your account: After your account has been opened in full, you’ll need to transfer trading funds into the brokerage account. Most traders in Guyana accomplish this by linking their bank account to their brokerage account and moving money directly between the 2, but many brokers also support wire transfers and e-wallet transfers as well.
• Place your first trade: Wait for the funds you’ve transferred to clear into your account, then make your first currency trade using your platform of choice. 

Guyana Forex Trading Strategies

There are 2 primary strategies that traders in Guyana use to determine which currencies to buy and sell: fundamental analysis and technical analysis. Fundamental analysis relies on identifying political and economic factors that influence currency relations, while technical analysis takes a more charting-oriented approach to identify patterns in price changes.

The specific strategy that’s right for you will vary depending on your financial goals and trading platform. Let’s take a closer look at when each strategy is used and what you’ll need to get started. 

Fundamental Analysis

Traders who use fundamental analysis as their primary trading strategy typically take a medium- or long-term approach to trading. These traders look at political and economic indicators to predict how these factors will cause currency values to shift. Some of the sources of information traders using fundamental analysis might use to do their research include:

• Consumer confidence indexes
• GDP reports
• Unemployment rates
• Bond interest rates
• Durable good and industrial good orders
• Business sentiments and non-farm payroll data

To begin trading using fundamental analysis, be sure that you have consistent access to reliable, unbiased international news.

Technical Analysis

Traders who use technical analysis typically don’t spend much time studying political events or economic reports. Instead, they use charting software to chart currency movements, searching for patterns and indicators that might offer clues to how the currency’s value will change in the future. Some factors that technical analysis traders might consider include:

• Breakouts that signal a currency will show a quick increase in value
• Reversal candlesticks that indicate that the currency will change directions
• Moving averages and how they’re changing
• Volume changes

Traders who use technical analysis as their primary trading strategy typically take a short-term approach to trading. To get started with technical analysis, be sure that you have a reliable trading platform and plenty of practice identifying your buy and sell signals. 

Forex Trading Example in Guyana

How does forex trading work? Guyanese forex traders take advantage of fluctuations in currencies as they relate to the Guyanese dollar. These traders purchase currencies when the GYD is strong and sell them back when the value falls again. Let’s take a look at an example.

You open a brokerage account with an international forex broker and deposit G$100,000 into your account. Your broker offers you 10:1 leverage when trading, which means that you can trade with the power of G$1 million despite only having G$100,000 in your account. You decide that you want to use your trading funds to invest in the USD, which is currently trading at $0.0047 per G$1.

Using your entire lot and leverage, you purchase $4,700 USD. Soon, you see that the value of the USD is rising in comparison to the GYD. When 1 GYD is equal to $0.0042, you decide to cash out. You convert your entire lot of USD back into GYD and are left with about G$1,119,047. After you account for the money you borrowed in leverage and your initial deposit, you’ve made a profit of about G$119,047 on this trade. 

Making Money with Forex in Guyana

Making money with forex in Guyana is possible and completely legal. Unlike some other countries, there are no limitations on the amount of profit that you can take when trading forex, and you can convert Guyanese dollars to any currency you have access to freely.

While this lack of restrictions can make accessing the market easier, it has also led to an increase in forex scams and tax evasion. If you decide to trade forex, take the following steps to protect yourself and your investment.

• Record all of your profits: The government of Guyana is cracking down on tax evasion and non-reported income. Keep careful notes on your profits and losses throughout the year so you can more accurately report your true earnings when you pay taxes.
• Check for licensure: Not every forex broker operating in Guyana is registered with the Bank of Guyana. If you work with a local broker, ask about licensure before you open an account. If you choose an international broker, make sure the broker is registered with an overseas regulatory body or agreement like the European Union’s Markets in Financial Instruments Directive.
• Be careful when using leverage: It’s possible to find very high leverage availability throughout Guyana. If you decide to trade with leverage, be wary of margin calls and interest rates.

Compare Online Forex Brokers in Guyana

When you trade forex, you’ll work through a forex broker offering service to clients in Guyana. There are a wide range of forex brokers offering both local currency trading services and service from an international headquarters. If you aren’t sure which broker to work with, begin by considering a few of our favorite options below. 

Forex Terminology

Forex traders use their own language to discuss trades and place orders. Familiarizing yourself with some of the most common terminologies can help you jump into the market more effectively. Below, you can browse some of the most common forex terms you’ll hear when trading.

• Pip: Forex currency movements are calculated using pips. A single pip is the smallest possible movement a currency can make. One pip is usually equal to 0.0001 of any given currency. For example, if the value of the Guyanese dollar goes from 0.0020 to 0.0030, you might hear a trader say that the value has moved by 10 pips.
• Lot size: Your lot size is the number of units of currency that you are buying or selling. For example, if you want to exchange G$100,000 into USD, your lot size is equal to 100,000.
• Orders: An order is a set of instructions you provide to your broker instructing them to buy or sell a currency on your behalf. There are multiple types of orders, and you can use a variety of order types to limit losses and automatically take profits.
• Calls: If you use leverage to trade forex, you’ll need to be mindful of calls. If the value of your portfolio falls below a certain percentage when using margin, your broker might subject you to a call. If you receive a call, you must deposit more money into your account or close out of your position. 

Trade Safely and Securely in Guyana

The country of Guyana has historically faced multiple problems with forex traders evading taxes and forex scams operating throughout the country. If you decide to trade forex, be sure to document all of the profits you take from your trading and report it to the correct authorities. This will allow you to pay the correct taxes on your earnings and limit your liability.

Frequently Asked Questions