Foreign exchange market is like other commodity markets, or the stock market. Like stocks, up and down, you can choose to buy or sell.
As like trading stock stocks, you need to buy in a lower exchange rate, and then sell it after the appreciation of the exchange rate, the price difference is your profit.
You can also do it in reverse way, knowing that the price of the currency will fall, you sell it at a higher exchange rate, and then buy it back after the exchange rate falls, the difference is your profit.
How do I trade in the Forex market?
Forex trading is very simple, first of all you need to open a forex trade account in one of the forex brokers. Just like we trading stocks, we need to open an account at one of the stock brokers, downloading and installing the trading program.
Who is doing Forex trading?
Why every day the world's foreign exchange trading volume is so big, first, international trade accounted for 5%, from the global trading, and then they turn their profit back to their own currency. Second, accounting for 95%, most are trading forex to earn profit and do speculative forex trading.
Most popular currency:
Most forex trades are in the currencies with the most circulation, the US dollar, the yen, the euro, the pound, the Swiss franc, the Canadian dollar, and the Australian dollar. Foreign exchange market is the world's largest financial market, the foreign exchange market is 24 hours of operation, and closed in the US Eastern weekend.
Most important cross currency pairs
AUD / USD - Brokers offer AUD / USD currency pairs.
EUR / USD - Brokers offer EUR / USD currency pairs.
GBP / USD - Brokers offer GBP / USD currency pairs.
NZD / USD - Brokers offer NZD / USD currency pairs.
USD / JPY - Brokers offer USD / JPY currency pairs.
USD / CAD - Brokers offer USD / CAD currency pairs.
USD / CHF - Brokers offer USD / CHF currency pairs.
AUD / JPY - Brokers offer AUD / JPY currency pairs.
CAD / JPY - Brokers offer CAD / JPY currency pairs.
CHF / JPY - Brokers offer CHF / JPY currency pairs.
EUR / AUD - Brokers offer EUR / AUD currency pairs.
EUR / CHF - Brokers offer EUR / CHF currency pairs.
EUR / GBP - Brokers offer EUR / GBP currency pairs.
EUR / JPY - Brokers offer EUR / JPY currency pairs.
GBP / CHF - Broker offers GBP / CHF currency pairs.
How much do you need to trade?
Two methods of general foreign exchange trading: Cash transactions , Forex margin trading
1. Currency cash transactions: Foreign currency exchanges at current rate and deposits into your foreign bank account, foreign currency deposit transaction costs are too high, therefore it's not suitable for frequent transactions.
2. Forex margin trading: Forex margin trading is popularly practiced on the market to earn returns, mostly due to lower investment thresholds and lower costs.
Leverage ratio: 1: 50, 1: 100, 1: 200, 1: 500 (depending on each forex broker and country)
What is leverage: Transactions are executed with borrowed funds. This allows you to leverage funds.
Leverage of 1: 100 allows you to trade $ 500 in the market for a $ 5 deposit, which means you can invest more money in the market than you have in your account, but leverage possibly increasing your losses.
The use of leverage for forex may not be suitable for all investors.
A high degree of leverage means high return and high risk, so make sure that you do carefully on fund management.
Trading hours: 24 hours / Monday to Friday
Margin: Depends on each Forex company