Beginner Guide to Basic Forex Trading

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The name Forex, come from Foreign Exchange Market, which also referred as “Forex”. “FX”. In short. Basically it involves a pair of currency. Meaning you buy a currency in exchange to another country currency.

For example if you visit Hong Kong from US. What'd you do? Go to the money changer, use your US dollar to exchange for Hong Kong dollar right? By doing so you're actually selling your US dollar and buying Hong Kong dollar so that you can spend in Hong Kong. So if you return to US, you too will exchange your Hong Kong dollar to US dollar. Now you're buying back US dollar and selling your Hong Kong dollar. By now I hope you get the idea of basic currency trading.

So why trade Forex, you may ask? Well Forex is a 24 hours market and it's one of the largest markets in the world in term of daily volume. It trade volume range from 1 to 3 trillion USD every day. This is 6 to 8 times higher than the volume of the stock market in the world. It provides a lot of liquidity in the market. The large volume of participants also reduces opportunities for insider trading. To put thing to simple, there has NEVER been a case of complete currency collapse in a developed country.

For Forex trading is there is no restriction of short selling. Meaning you can buy (Long) or sell (Short). This mean you can easily trade in a rising or falling market.

Another great advantage of Forex Trading is leverage. Typically leverage increases your buying power. With this…



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