Where To Trade Currencies
Forex Trading is catching on like wildfire amongst private traders
, and there are good reasons for it. Forex is the largest known financial market in the whole world, and the most liquid to trade in. Also, the requirements to open a currency forex trading account are much less stringent than for stock trades. The term "Forex" is short for Foreign Exchange. The daily turnover in currency markets is currently $1.9 TRILLION dollars. Amazingly, this is over TEN times the average daily turnover of ALL the global equity markets put together. It's more than 40 times the daily turnover of all securities on the New York Stock Exchange. So what is Forex? In layman's terms, Forex trading means the simultaneous buying of one currency and the selling of a second currency. In other words, the currencies are traded in pairs, i.e. one currency traded for another.Interestingly, only 5% of the turnover in daily forex currency trades comes from companies and governments buying and selling products and services from foreign countries. These entities then engage in forex trades in order to convert their foreign currency profits back into their respective domestic currencies. Amazingly, the remaining 95% of turnover is pure speculation, i.e. forex trading entirely for profit! If you're new to FOREX currency trading, familiarize yourself with the most liquid currencies. These are the most traded, and where you stand your best chance of trading success. They include the US dollar, Euro, Japanese yen, British pound (also nicknamed "Cable"), Canadian dollar, Swiss franc and the Australian dollar.
The main part of Forex trading education is to learn about the market conditions. As the scenario of Forex market keeps on changing, Forex trading education will help you observe these market conditions and how can they be favorable for you.
Forex Markets entertain a wide variety of participants with varying goals. Some enter the market with a long term investment goals, while other are day traders acting for the extremely short term only. Forex trading, involving foreign currencies on an exchange, is not centralized. It takes place via telecommunications. Also, currency trading is open twenty four hours a day. Currency dealers will quote all the major currencies in every time-zone in the world.
Forex currency trading can be an extremely rewarding business, provided you thoroughly know what you are doing. However, like any other business there are always risks (and potentially disastrous ones) for the novice who foolishly dives in without thorough preparation. Where there are risks, there are also rewards. The upside potential, with limited downside risk (provided you know how to place trades with discipline and exercise excellent risk management) can be enormous.
The various ways to get Forex trading education are:
There are a lot of great benefits to forex trading - and some of the better benefits are available for people who are just starting out. Free demo accounts, information, and news are available - allowing newbies to learn about the market while practicing their trading skills. Mini and Micro trading will also greatly benefit amateurs as these accounts can let them trade in the forex market without risking too much money.
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