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I am an amateur woman to market and technology that seeks to share their knowledge on trade
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What is Forex?
The forex market is the foreign exchange market. It is the world's largest, with a volume of over 4 trillion daily financial market business. To understand what this means turnover, which is what can move the New York Stock Exchange around a month.
Unlike other financial markets, the Forex market is decentralized and does not have a physical location. The Forex market is considered an interbank market or OTC (over-the-counter, desk), due to the fact that this market operates electronically in a network of banks 24 hours a day.
Forex trading involves buying and selling currencies, coins, ie money. Currencies are traded through a broker or dealer and are traded in pairs, for example Euro and the US dollar (EUR / USD).
I really do not buy or sell anything physically so you can confuse a little. Think about buying currency as buying a share in the economy of a country, as the price of its currency is a direct reflection of what the market thinks about the current and future state of the economy. Forex, as mentioned, is traded in currency pairs, as indicated in this paragraph, the quoted price of a given currency pair reflects the economic conditions of a country before the country of the other currency that makes up the pair.
Imagine a situation where it is expected that the dollar will weaken against the euro forex trader in this situation will sell dollars and buy euros. If the euro strengthens, the purchasing power to buy dollars increase. The merchant can now buy back more dollars than they had to start making a profit.
This is similar to stock trading. A broker to buy a stock if you think the price will increase in the future and will sell a stock if you think its price will fall in the future. Likewise, a forex trader will buy a currency pair if you expect the exchange rate to increase in the future and sell a currency pair if you expect the exchange rate to fall in the future.
Main Forex trading attractions
No commissions. Usually the trader is not loaded with almost all committees. Agents which operates by charging the spread, typically represented less than 0.1 percent in operating costs in larger brokers may even be less than 0.07 percent.
Find out why. The Forex market as we refer eFXto is the "spot" Forex market, which means dealing directly with the market.
Flexible lot. The minimum contract is very flexible operation in Forex over other markets. And choose the size of their operation. This allows to part with as little as $ 50 bills, you can even operate cents.
Programming 24 hours. From Sunday evening to Friday afternoon you can operate at any time of day.
Leverage. A small amount of capital can control a much larger volume of Forex trading, this is due to the high leverage available in this market. For example, with a 100: 1 leverage, you can do an operation of 100 thousand pieces with a deposit of just one thousand. But this is a double-edged sword, with high leverage can lead to large losses and high gains.
The high liquidity. Being such a large market, the liquidity is also huge. This means that, under normal market conditions, may purchase or sell instantly.
Mini and micro trading. You can start trading Forex with mini or micro accounts that require low minimum deposit, $ 500 or less. This makes it accessible to almost everyone, however, to operate with appropriate risk control can be recommended a greater initial deposit, I'll understand.
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