Basics of Forex Trading

Posted at November 16, 2009

We have already said, that you can invest into stocks. So, why invest also in Forex?

As you could read thousand times, one more time it doesn’t hurt you, FOREX is abbrevation for International Interbank FOReign Exchange. Forex is about trading currency pairs. Gigantic trades make banks, investors and dealer companies. By the way, banks have also their own Forex departments as you can see. Here lies many more percents than bank gives into your bank account as estimation. Congratulation yourself for 3-5% a year – a bank has from your money a lot more. Thanks to trades of these big companies Forex becomes the most liquide market on the Earth.

Its average daily volume is over 3,000,000,000,000 dollars, what is several times more than New York and London Stock Market together. Forex has no central place unlike stock or commodity market.

You can imagine Forex as a global network connects big banks, broker houses, fonds, insurerance companies etc. It is a kind of specific network which is used for exchange.

Forex traders speculate on exchange rate movements. They eanr/lose money thanks to mutual movements. Thanks to modern technologies you can trade from your home. You need only computer, internet connection and trading software. For many people it looks very easy (untrustworthy) that you need only those 3 things to start. I can say, that start is the easiest step in this journey. Begin can everyone, but not everyone will profit.

Forex is very suitable for small investors (which can in time become big fish ) thanks to trade with margin. Margin are borrowed money from brokers. It is called Leverage trading. With very little money you can earn very high amounts. It can many times increase your profit – or losses, indeed. I say, that investor which has no plan suited for Forex can only lose all his account. Forex is only about definite plan and its observance. It can cut your potential profit, but you can be sure, that your account will be only increasing. Slowly, but it will.

Trade in Forex is very good place how to earn some extra cash or make very serious business.

More important information is, how to not lose your money. I’ll provide all needed information how to begin with Forex and how to not lose everything, like 95% of others do.

Remember, that Forex is only about strict rules of your strategy. This game can’t be played like Stocks. There pay other rules, this is a wasteland. Only strong will survive.

How much do you need and how much can you earn? Very hype questions, but there must be the answer. You can start even with only $10, thanks to leverage effect you will be able for example to trade with $100 ($90 burrowed). But, well, that is not much. The best option is to start with $200 in minimum to earn some good cash. But before earning, there is long and hard path to become profitable trader. Looking at awesome numbers is good, but not motivational. If you will start learning Forex today, in a year you can have absolutely different life. If you will start learning my complete business plan, you will become very asked person (by women, of course ) with unique life and everything your heart wishes. Personaly, I’m using Forex only for little investments, which profits I realocate then into stable stocks, which works for me as a bank account. The decision lies within you.