Forex is the abbreviated name for foreign exchange. The Forex market is an around-the-clock cash market countries where currencies are bought and sold, typically via brokers. Example: You buy Euro, with U. S. Dollar, or you sell Canadian dollars for Japanese Yen. Forex trading market conditions, at any time in response to real-time events, such as political unrest or the inflation rate. The aim of this article is to give an introduction to Forex trading.
Here are some of the characteristics unique to Forex trading as private investors that:
Accessibility : The Forex is open 24 hours a day, 6 days a week. They have non-stop online access to global Forex sales through your computer at home. In this way, you can log in to your account and trade anytime, from anywhere.
Low margin requirements as a safety margin is needed to reach an agreement. In currency trading, this is usually a very small part of overall treatment, say 1% or 1:100. For example, if your margin is $ 100 (1% of the total Forex in this case), you can use to control 10,000 U. S. Dollar currency contracts. However, a margin is double-edged sword. Without the use of appropriate risk management tools (that is, Stop Loss and Take-profit orders), can cause huge losses and gains.
Risk Management Tools: Essential for a successful Forex trading system, these tools are Stop Loss and Take-profit orders. A stop-loss market is a way for the completion of a Forex position if or when a predetermined error threshold. One way to take-profit is a market for the completion of a Forex position if or when profits a predetermined threshold.
Zero Commission Trading: Unlike equities or futures trading, you do not pay commissions on the Forex us that you have.
Liquidity : Forex is the most liquid market in the world, making it easier to trade currencies.
Here are some more facts about Forex trading:
According to The Wall Street Journal Europe, the most actively traded currencies in the Forex Trading market is U. S. Dollar (USD), the Japanese Yen (JPY) Euro (EUR) British Pound (GBP), Swiss franc (CHF) Canadian Dollar (CAD) and Australian dollar (AUD).
Worst traded currency pairs are the U. S. Dollar and Japanese Yen (USD / JPY), Euro and U. S. Dollar (EUR / USD), the U. S. Dollar and Swiss franc (USD / CHF), and the British pound and U. S. Dollar (EUR / USD).
Ten financial institutions account for nearly 73% of the total market for trading in Forex band. The Top 10 German merchant bank (17.0%), UBS (12.5%), Citigroup (7.5%), HSBC (6.4%), Barclays (5.9%), Merrill Lynch (5.7%), JP Morgan Chasa (5.3%) , Goldman Sachs (4.4%) ABN Amro (4.2%) and Morgan Stanley (3.9%).
The five major centers of Forex trading are London, New York, Tokyo, Sydney and Frankfurt. The three countries are major trading Forex United Kingdom (32.4%), the United States (18.2%) and Japan (7.6%).
Forex traders generally trading strategies for two types of Forex analysis: fundamental and technical.
A fundamental analysis uses economic and political factors, such as unemployment, interest rates or inflation, as a means to predict exchange rate fluctuations. Fundamental analysis focuses on the reasons or causes for currency fluctuations.
A technical analysis uses historical data as a tool for prediction of exchange rate fluctuations. Technical analyst believes that history repeats itself ceaselessly. Technical analysis is not about the reasons for currency movements (for example, interest rates or inflation). Instead, he believes that historical currency movements are a clear indication of the future will be.
Some Forex trading on fundamental analysis while others depend on technical analysis. But many successful Forex traders use a combination of both strategies. However, the important point here is to remember that not a strategy or a combination of strategies is 100% secure.
As with stocks and mutual funds, there is a risk in Forex trading. The risk arises from fluctuations in currency exchange market. Low-risk investments (eg, long-term government bonds) often have a low yield. Investments with a higher risk (such as Forex trading), a higher yield. To make your short-term and long-term financial goals, you must be a risk to security and comfort that is best for you .
Here are some of the characteristics unique to Forex trading as private investors that:
Accessibility : The Forex is open 24 hours a day, 6 days a week. They have non-stop online access to global Forex sales through your computer at home. In this way, you can log in to your account and trade anytime, from anywhere.
Low margin requirements as a safety margin is needed to reach an agreement. In currency trading, this is usually a very small part of overall treatment, say 1% or 1:100. For example, if your margin is $ 100 (1% of the total Forex in this case), you can use to control 10,000 U. S. Dollar currency contracts. However, a margin is double-edged sword. Without the use of appropriate risk management tools (that is, Stop Loss and Take-profit orders), can cause huge losses and gains.
Risk Management Tools: Essential for a successful Forex trading system, these tools are Stop Loss and Take-profit orders. A stop-loss market is a way for the completion of a Forex position if or when a predetermined error threshold. One way to take-profit is a market for the completion of a Forex position if or when profits a predetermined threshold.
Zero Commission Trading: Unlike equities or futures trading, you do not pay commissions on the Forex us that you have.
Liquidity : Forex is the most liquid market in the world, making it easier to trade currencies.
Here are some more facts about Forex trading:
According to The Wall Street Journal Europe, the most actively traded currencies in the Forex Trading market is U. S. Dollar (USD), the Japanese Yen (JPY) Euro (EUR) British Pound (GBP), Swiss franc (CHF) Canadian Dollar (CAD) and Australian dollar (AUD).
Worst traded currency pairs are the U. S. Dollar and Japanese Yen (USD / JPY), Euro and U. S. Dollar (EUR / USD), the U. S. Dollar and Swiss franc (USD / CHF), and the British pound and U. S. Dollar (EUR / USD).
Ten financial institutions account for nearly 73% of the total market for trading in Forex band. The Top 10 German merchant bank (17.0%), UBS (12.5%), Citigroup (7.5%), HSBC (6.4%), Barclays (5.9%), Merrill Lynch (5.7%), JP Morgan Chasa (5.3%) , Goldman Sachs (4.4%) ABN Amro (4.2%) and Morgan Stanley (3.9%).
The five major centers of Forex trading are London, New York, Tokyo, Sydney and Frankfurt. The three countries are major trading Forex United Kingdom (32.4%), the United States (18.2%) and Japan (7.6%).
Forex traders generally trading strategies for two types of Forex analysis: fundamental and technical.
A fundamental analysis uses economic and political factors, such as unemployment, interest rates or inflation, as a means to predict exchange rate fluctuations. Fundamental analysis focuses on the reasons or causes for currency fluctuations.
A technical analysis uses historical data as a tool for prediction of exchange rate fluctuations. Technical analyst believes that history repeats itself ceaselessly. Technical analysis is not about the reasons for currency movements (for example, interest rates or inflation). Instead, he believes that historical currency movements are a clear indication of the future will be.
Some Forex trading on fundamental analysis while others depend on technical analysis. But many successful Forex traders use a combination of both strategies. However, the important point here is to remember that not a strategy or a combination of strategies is 100% secure.
As with stocks and mutual funds, there is a risk in Forex trading. The risk arises from fluctuations in currency exchange market. Low-risk investments (eg, long-term government bonds) often have a low yield. Investments with a higher risk (such as Forex trading), a higher yield. To make your short-term and long-term financial goals, you must be a risk to security and comfort that is best for you .
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