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Currency trading, the buying and selling of currency pairs, is one of the largest and most liquid markets in the world. As a South African resident, you have the unique opportunity to trade the rand (ZAR) against global currencies like the US dollar (USD) and Euro (EUR). And with BROKSTOCK, you can trade these ZAR pairs via CFDs (Contracts for Difference), a method that allows you to speculate on price movements without owning the actual currencies.
How ZAR currency trading works
When you trade a ZAR pair like USD/ZAR, you’re speculating on the value of the dollar relative to the rand. If you believe the dollar will strengthen against the rand, you take a long (buy) position. If you believe the ZAR will strengthen, you short (sell) the pair. You’re not exchanging currency at a bank; you’re entering a contract that captures the price difference from when you open the position to when you close it.
Let’s say you go long on USD/ZAR at R18. If the pair rises to 18.50, you profit from the R0.50 difference. If it falls to R17.80, you incur a loss of R0.20. With currency trading, you benefit from these movements without ever converting your money.
Why trade ZAR pairs locally?
BROKSTOCK offers a ZAR-denominated trading environment, which means you deposit and withdraw in ZAR. No foreign bank accounts or conversion hassles. This makes your costs transparent and allows you to trade global currency pairs while managing your exposure locally.
Potential benefits
● Rand-based deposits: Trade ZAR major currency pairs directly from your single account
● No currency conversion fees: All trades and profits stay in ZAR
● Real-time access: Monitor ZAR pairs and react to SA economic data with a real-time price feed.
Margin Trading
BROKSTOCK gives you the option to trade ZAR pairs with or without margin. Turning on margin trading means you can control larger positions with smaller capital, amplifying both gains and losses.
A R5 000 trade on USD/ZAR with 10% minimum margin gives you R50 000 exposure. A 1% move in your favour results in R500, but the same loss applies if it goes against you.
Prefer lower risk? You can turn off margin and invest at full value, limiting downside risk while avoiding margin altogether.
Using the app to trade ZAR pairs
Trading ZAR pairs through BROKSTOCK’s digital platform is intuitive and streamlined:
● Step 1: Fund your account in rands
● Step 2: Search for your desired currency pair (e.g. USD/ZAR)
● Step 3: Analyse the chart, set your limit order, stop-loss and take-profit
● Step 4: Monitor your position and account performance analytics
● Step 5: Close the trade when you’re ready. Profit/loss is shown in ZAR
Currency trading, particularly in ZAR pairs, offers investors the ability to participate in global markets without needing offshore accounts or foreign currency. Using a locally regulated platform like BROKSTOCK adds further convenience.
Disclaimer:
*Any opinions, views, analysis, or other information provided in this article is provided by BROKSTOCK SA trading as BROKSTOCK as general market commentary and should not be viewed as advice according to the FAIS Act of 2002. BROKSTOCK SA does not warrant the correctness, accuracy, timeliness, reliability, or completeness of any information provided by third parties. You must rely upon your judgement in all aspects of your investment decisions, and all decisions are made at your own risk. BROKSTOCK SA and any of its employees shall not be responsible for and will not accept any liability for any direct or indirect loss, including, without limitation, any loss of profit which may arise directly or indirectly from the use of the market commentary. The content contained within the article is subject to change at any time without notice. BROKSTOCK SA is an authorised financial services provider - FSP No. 51404. T&Cs and Disclaimers are applicable: https://brokstock.co.za/
