Dear friends, forex trading main kamiabi kay liay trader mukhtalif tools aur indicators ka use kartay hain aur in par analysis bhi kartay hain, in analysis main bhi indicators ka use karty hain, fundamental aur technical analysis ko mazeed valid aur reliable bananay kay liay kai tarah ki theories aur models ka bhi sahara lia jata hay. In he main say aik useful model purchasing power parity hay.
Detail of Purchasing Power Parity:
Purchasing power parity term microeconomic users istemal karty hain jis ki help say wo different countries ki currency ko compare kartay hain, is purpose kay liay wo goods basket ko use karty hain, in countries ki currencies kay exchange rates main tab tawazan hota hay jab donon mumalik main kisi commodity ki same purchasing power ho, ager kisi aik mulk main price ka izafa hoga to iska matlab hoga keh is mulk main inflation rate main izafa ho gia hay, is tarah exchange rate main bhi faraq aa jata hay, is kay zariay analyst different countries kay standard of living ko bhi janchtay hain jis ki help say unko ye bhi pata chal jata hai kay kis country ma inflation rate kitna hai aur es inflation rate ka direct relation currenct exchange rate par hota ha, jis ki base par forex trading ma trader bhot sari trades ko open kar kay profit aur loss ko hasil kartay hain
How this model compare inflation rates of two countries:
Purchasing power parity model kay tahat two countries ki currency goods purchasing main to 2:1 ratio say move kar rahi hain. Laikin jab kisi mulk main inflation main izafa hota hay to isky exchange rate main kami a jati hay jis say forex market main bhi is currency ki value low ho jati hay, Trader us country kay exchange rate ko use kar kay other countries ki currency ko predict kartay hain aur iski base par wo knowledge say yeh findout kar laity hain k kisi country ma trade karny ka kitna benefit ho sakta ha, isi tarah currencies ki demand and supply concern per bhi asar parta hay. Purchasing power parity model kay teht kai traders do mumalik ki currencies main tawazan ka pata chalaty huay forex main inki future value predict kar sakty hain
Limitation of purchasing power parity model:
trader ko aisay knowledge ko ignore nhi karna chaiay kiun kay ye trade ko currency correlation ki reading daita hai jis say trader ko loss say bachny main help milta hai aur wo acha profit hasil karny ma kamyab ho sakta ha, is kay kuch drawbacks bhi hain matlab ye model sirf long term exchange rate ko measure karnay main to madad daita hay laikin short term main ye help nai daita, jab kay ye sirf goods per reflect karta hay laikin services per reflect nahi karta.
Detail of Purchasing Power Parity:
Purchasing power parity term microeconomic users istemal karty hain jis ki help say wo different countries ki currency ko compare kartay hain, is purpose kay liay wo goods basket ko use karty hain, in countries ki currencies kay exchange rates main tab tawazan hota hay jab donon mumalik main kisi commodity ki same purchasing power ho, ager kisi aik mulk main price ka izafa hoga to iska matlab hoga keh is mulk main inflation rate main izafa ho gia hay, is tarah exchange rate main bhi faraq aa jata hay, is kay zariay analyst different countries kay standard of living ko bhi janchtay hain jis ki help say unko ye bhi pata chal jata hai kay kis country ma inflation rate kitna hai aur es inflation rate ka direct relation currenct exchange rate par hota ha, jis ki base par forex trading ma trader bhot sari trades ko open kar kay profit aur loss ko hasil kartay hain
How this model compare inflation rates of two countries:
Purchasing power parity model kay tahat two countries ki currency goods purchasing main to 2:1 ratio say move kar rahi hain. Laikin jab kisi mulk main inflation main izafa hota hay to isky exchange rate main kami a jati hay jis say forex market main bhi is currency ki value low ho jati hay, Trader us country kay exchange rate ko use kar kay other countries ki currency ko predict kartay hain aur iski base par wo knowledge say yeh findout kar laity hain k kisi country ma trade karny ka kitna benefit ho sakta ha, isi tarah currencies ki demand and supply concern per bhi asar parta hay. Purchasing power parity model kay teht kai traders do mumalik ki currencies main tawazan ka pata chalaty huay forex main inki future value predict kar sakty hain
Limitation of purchasing power parity model:
trader ko aisay knowledge ko ignore nhi karna chaiay kiun kay ye trade ko currency correlation ki reading daita hai jis say trader ko loss say bachny main help milta hai aur wo acha profit hasil karny ma kamyab ho sakta ha, is kay kuch drawbacks bhi hain matlab ye model sirf long term exchange rate ko measure karnay main to madad daita hay laikin short term main ye help nai daita, jab kay ye sirf goods per reflect karta hay laikin services per reflect nahi karta.
