By Indy – The trading of currencies on the currency exchange is what is known as forex trading. To a good number people, currency trading is pretty tricky to take in at the start. Fortunately, forex trading is a uncomplicated procedure with mechanics that are easily understood.
The foreign exchange market is the worlds biggest trading market. This market sees the exchange of some 2 trillion dollars per day.
The currency market is a international market rather than centralized. All the worlds currencies are traded here. Some general trading platforms include metatrader 4 as well as an assortment of java based trading platforms.
The forex market is open twenty four hours a day for trading. Although it should be noted that trading is not permissible on Saturdays and Sundays.
The value of a country’s currency depends on economic as well as political factors. Since stability plays such a big role in the forex markets, the top traded countries come from stable countries such as America and Europe.
The idea, like most markets, is to sell high and buy low. The sort of trades taken also differ depending on the speciality of the trader. Many traders enjoy the high risk strategy of scalping the market while others prefer to lay back and relax with long term trades.
Forex trading has the possibility for big profits. Leverages of up to 250:1 are enjoyed through their forex brokers. Leverages are important because they determine how much a trader can borrow when opening a trade.
The forex market can be very volatile. Big profits are possible with small amounts of investment. There are no commissions charged, you pay what is recognized as the spread. The currency pair is the determining factor in the spread paid. Highly fickle currencies usually have higher spreads and vice versa.
While a lot of money can be made in the forex market, there are also risks involved, usually high risk. There are several trading strategies and money management techniques one can make use of to reduce these risks. Months of demo trading is needed before one truly understands the nuances of the forex trading market.
About the Author
Indy operates a finance based portal www.forextrading.my , as well as being a real estate agent for 15 years now, but his my true passion lies in marine aquariums.
His website deals with many forms of investment such a the bonds market, stock trading, forex trading and mutual funds.
