Forex trading is the new way to make money through online currency trading. With a worldwide market and over 60 currencies for you to trade there has never been an easier way to make money online.
Forex trading until recently was reserved for banks and other large financial industries but thanks to the power of the internet and online currency trading, forex has now become feasible for everyday people. The forex market has become the largest trading market in the world and each day there is an estimated turnover of over $1.5 trillion dollars. Another added bonus is that forex trading is available 24 hours a day, 5 days a week unlike most other markets that operate on an 8 hour day. This means that people wishing to trade forex can do so at any given time.
Forex currency trading is done in pairs and these are known as crosses. These pairs are always against the US dollar and the main crosses you will find when trading forex are the USD/EUR and the USD/GDP. The most popular crosses are known as majors and these can make forex traders great profits. Currencies change on a regular basis and are based on the how the world financial markets see the value of the currencies. You can sell or buy these currencies and forex brokers do not charge commission fees.
There are two types of forex accounts; a mini forex account and a regular forex account. Mini forex trading is an excellent way for small investors to learn about and take part in forex trading and with the most forex brokers offering a leverage of 100:1, mini forex trading will allow you to control a $10,000 currency position with a deposit of only $100. Mini forex trading is a great way to get a feel for forex trading and learn the tricks and skills needed to succeed without having to go to great expense. Why not try mini forex trading now and see just how easy it is to profit with forex trading.
This piece of information is shared by Yee Kok Siong, an arbitrageur and a forex investor. Mr. Siong is a self-motivated entrepreneur who believes that no market is perfect and it is up-to an individual to understand that imperfect gap and business opportunity and make the most out of it.
To know more about him, please visit here: https://yeekoksiong.wordpress.com/
Forex, the Foreign Exchange Market, is a worldwide market for buying and selling foreign currencies. The major currencies that are traded include the U.S. Dollar (USD), Euro (EUR), British Pound (GBP), Canadian Dollar (CAD), Australian Dollar (AUD), Japanese Yen (JPY), and the Swiss Franc (CHF). The purpose of this article by Yee Kok Siong is not to go into the details of how Forex works, but to compare the benefits of trading in the Forex market versus trading the Equity (American stocks) or Futures markets (Commodities).
The Forex market is the largest market in the world with over 2 trillion dollars traded every day. This compares to the 200 billion dollars traded daily in the Equity and Futures market each. Because of this, the Forex market benefits from fairer prices, price stability, and better trade execution.
Forex has the advantage of being open 24 hours a day. The Forex market opens on Sunday afternoon and remains open until it closes on Friday afternoon. The Equity and Futures markets are only open Monday through Friday 8:30 a.m. to 5:00 p.m. Eastern Standard Time. This gives Forex traders the opportunity to trade around their personal schedule. Also, liquidity in the Equity and Futures markets are reduced after regular trading hours.
When trading Forex, you will not incur the commissions or transaction fees that exist in the Equity and Futures markets. You pay a spread on the currency pair you are trading and costs are very low, especially when compared to the other markets.
Investment leverage in the Forex market can be as high as a 200:1 margin. In the Equity and Futures markets your average margin is 4:1. This means that you can control $10,000 worth of currency with only a 50-dollar margin.
In the Equity and Futures markets, investors are expected to fund several thousand dollars to open a trading account. In the Forex market, you can open a mini account for only 300 dollars and begin trading.
In the Equity market, short selling is very risky and comes with limitations. In the Forex market, you are able to buy long or sell short any currency pair with no limitations or difference in risk.
As an investor in the Forex market, you are able to concentrate on only a few major currencies. There are seven major currencies yielding four major currency pairs that most Forex investors concentrate on. Whereas in the Equity market, investors have over 40,000 stocks to choose from when contemplating where to invest their money
There are many factors to consider when deciding on which market you want to spend your time and money. The Forex market provides many benefits over the other major investment markets that will allow you, the investor, to make larger profits, take less risk, and spend more time with your personal life and less time investing.
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It is called a pip and its value is the equivalent of 0.0001 of a dollar, in most currency pairs, and it is the smallest increment on the Forex market. A pip in the Japanese Yen is 0.01. Now you might find yourself wondering what the Forex market actually is and why anyone would possibly think chasing pips was ever going to be a profitable endeavor. However, with almost $2 trillion dollars being exchanged on the Forex each and every day it is open (from Sunday through Friday, the market trades 24 hours a day), those pips can quickly add up to big profits—or big losses—really quick. This makes it one of the most exciting, volatile, and engaging markets in the investment world.
So what exactly is the Forex anyway? Well, the Forex is just a big market where corporations, nations, and investors can exchange money. For instance, if an American corporation wanted to fund their payroll account for an office in Paris, they would need to convert U.S. dollars into Euros. However, one U.S. dollar does not equal a Euro.
To convert the money, the business would need to buy Euros with dollars on the Forex. The USD/EUR currency pair is what the company would need to buy in order to raise the money for payroll. A typical transaction on the Forex is called a lot and is $100,000 and the USD is behind 90% of all trades on this volatile market. So, if the currency pair was valued at 1.2500USD, that means that the business would receive 80,000 Euros for every $100,000 lot of the USD/EUR currency pair at that exchange rate.
Now remember those pips? Although a pip is a very small number, the sheer size of the lot means that a 1 pip movement equals $10 ($100,000 X .0001). Thus, an investor can get in and out of a position very quickly if the price fluctuates by only a few pips and still make a profit (Forex scalping). It is very possible for a Forex trader to double their investment in a very short period of time—but they can lose it just as easily!
Until recently, retail Forex investors did not exist. Because of the size of the transactions, traders on the Forex used to be limited to large investment firms, central banks, etc. Now, however, a Forex investor can typically secure a position for as little as $1,000 (or 1/100th of the total transaction amount). However, because there are always interest charges associated with any leveraged position, that means that an investor can quickly lose their capital if things swing the wrong way.
Of course, no one has a crystal ball and can predict the future but Forex traders use a number of strategies to help them determine when to exit and enter positions. While profit potential is unlimited, stops are typically placed on orders to prevent unacceptable losses. No matter what investment strategy you choose to use when trading on the Forex—it is very wise to place stops on every order because the volatility of the market can sap a highly leveraged account very quickly.
Trading currencies on the Forex is so popular because the action is non-stop and the opportunity for profit is unlimited. However, because of the margins and volatility of the market itself, the Forex can make or break an investor quickly. New investors are highly encouraged to start out with mock accounts or even mini-lots ($10,000) in order to learn the market better before jumping in with both feet.
If you want to learn more, please visit here: https://yeekoksiong.wordpress.com/
What are the advantages of the Forex Market over other types of investments?
When thinking about various investments, there is one investment vehicle that comes to mind. The Forex or Foreign Currency Market has many advantages over other types of investments. The Forex market is open 24 hrs a day, unlike the regular stock markets. Most investments require a substantial amount of capital before you can take advantage of an investment opportunity. To trade Forex, you only need a small amount of capital. Anyone can enter the market with as little as $300 USD to trade a “mini account”, which allows you to trade lots of 10,000 units. One lot of 10,000 units of currency is equal to 1 contract. Each “pip” or move up or down in the currency pair is worth a $1 gain or loss, depending on which side of the market you are on. A standard account gives you control over 100,000 units of currency and a pip is worth $10.
The Forex market is also very liquid. When trading Forex you have full control of your capital.
Many other types of investments require holding your money up for long periods of time. This is a disadvantage because if you need to use the capital it can be difficult to access to it without taking a huge loss. Also, with a small amount of money, you can control
Forex traders can be profitable in bullish or bearish market conditions. Stock market traders need stock prices to rise in order to take a profit. Forex traders can make a profit during up trends and downtrends. Forex Trading can be risky, but with having the ability to have a good system to follow, good money management skills, and possessing self discipline, Forex trading can be a relatively low risk investment.
The Forex market can be traded anytime, anywhere. As long as you have access to a computer, you have the ability to trade the Forex market. An important thing to remember is before jumping into trading currencies, is it wise to practice with “paper money”, or “fake money.” Most brokers have demo accounts where you can download their trading station and practice real time with fake money. While this is no guarantee of your performance with real money, practicing can give you a huge advantage to become better prepared when you trade with your real, hard earned money. There are also many Forex courses on the internet, just be careful when choosing which ones to purchase.
Yee Kok Siong is an arbitrageur and an investor. Mr. Siong is a self-motivated entrepreneur who believes that no market is perfect and it is up-to an individual to understand that imperfect gap and business opportunity and make the most out of it.
To know more about Mr. Siong, please visit here: http://yeekoksiong.strikingly.com/
The foreign exchange market is more important to our daily lives than most people would ever realize. The forex market is used for the trading of foreign currency. This is essential for the economy of many nations. If you would like to trade currency in the forex market, then keep reading this article for tips shared by Yee Kok Siong.
To help you get the most out of your Forex account you should not risk more than 2-3% of the total trading account. The Forex market is not always favorable and it is important that you limit the amount of risk involved when factoring in unfavorable market conditions. The 2-3% rule is the difference between being successful and unsuccessful.
Beginner Forex traders should choose an account with a leverage ratio that will adequately serve the needs the strategy to reach the goals they have set for themselves. As a general rule, the lower your leverage, the better but talk with your broker to determine the best leverage ratio for you.
Don't go onto Forex when your stressed with time. Make sure you choose a moment where you can take the time to analyze the market and really focus on which trades are good and bad. Every person is different, some people are comfortable waiting hours before they see results and others can't go longer than 15 minutes without needing to see some type of result. Know yourself and choose a time frame that fits you.
The most important tip that anyone can get when getting involved with the forex market is to control your emotions and go with a logical approach. If you are trading out of greed, panic or fear, you are not using your best judgment. You need to be calm and clearheaded when trading to avoid making hasty trades.
When considering trading currency on Forex remember that the market can be extremely volatile. There are many who only want to focus on the up side of things, but given the current state of the economy on a world scale, values have been seen to go up and down at rates never seen before.
Beginning forex traders often wonder when it is wise to move from a demo account to a real account. A good rule of thumb is to move to a micro account after two or three months, and a regular account six months after that to give you plenty of time to learn without suffering large losses.
Set the amount of money you use to start a Forex trade to be a percentage of the total account balance. You should never open a trade at the same dollar amount each time as that won't grow your capital very quickly. Instead, use your profits to increase the amount you're trading with each time.
In conclusion, many people do not realize how important the foreign exchange market really is. Foreign currency is traded through the forex market, making the market essential for the economy of nations. Use the tips from the article shared by Yee Kok Siong above and you can begin trading foreign currency in the forex market.