First, we define what is Forex: Forex or foreign exchange market – the largest financial market in the world with a volume of trades 1.5 trillion dollars a day. Unlike other financial markets, Forex has no physical expansion location and central exchange. It operates through an electronic network of banks, corporations and individual players, producing between a transaction currency.
The essence of forex – money. Money around the world are bought, sold and traded. Anyone can buy and sell currencies on the forex market and has a chance to succeed. If you are a currency exchange, it is possible to make a profit by buying the currency of one country and selling it. For example, the broker can earn income by buying the Japanese yen when it rate against the dollar will grow, and sell when it is the opposite situation.
Forex and stock market involves buying and selling for profit, but there are some differences between them. Forex has a higher level of liquidity than the stock market. This means that every day in the Forex market to pay more money. The main differences between the Forex and stock markets – Forex in no particular location and it works around the clock. Forex enables banks and brokers all over the world to trade with each other 24 hours a day the whole business week.
Another difference between the stock market and forex – higher leverage in the Forex market. Forex trading will bring big profits, if you have enough experience and understand the market the device. You can lose a huge amount and under the same conditions. Everything depends on you.
Forex trading requires knowledge of a variety of special terms. Training Trading Forex can be quite difficult for a beginner. The symbols used for the representation of currencies in the Forex market, consist of two parts. The first part – the first currency, the second half – the second currency used. Symbol “usdjpy” means “US dollars”, ie, US dollars and Japanese yen. It is necessary to learn how to navigate in the notation of currencies, Forex learning terms. There are many books and websites that are dedicated to learning Forex trading.
Trading in the Forex market, you can use the services of a broker. Brokers – professional players in the Forex market, and their invaluable experience can be very useful for the novice trader. If you decide to hire a broker, there are several critical factors that must be taken into account when choosing. The first important point – give preference to a broker offers low spreads. The spread is calculated in pips and is the difference between the price at which a currency can be bought and the price at which it can be sold at a particular moment. Since Forex brokers do not charge commission they earn on spreads, or the difference. In the search for a broker note on these issues and compare candidates according to criteria.
It is also important to take into account the following factors. The broker must rely on large financial institutions. Bankers in the Forex market are usually associated with large banks or other financial institutions. Note that if the broker is not associated with the bank, it is not necessary to make a choice in his favor. Also, look for a broker that is registered by the company responsible for mediation in emergency operations (futures intermediary) and monitored by the Commission Commodity Futures Trading (CFTC). Make sure that the broker is properly registered and based on a large bank or other financial institution, you need to be confident in their choice. After all, you need a reliable broker with extensive experience of trading in the Forex market.
Pay attention to the availability of access to the latest market research tools and data retrieval. The broker you choose should have access to them. It is important that the broker had the opportunity to view the graphs, tables, ratings, news and other market data in real-time. This broker will make decisions based on an accurate forecast of the situation in the forex market. Look for brokers that offer a large range of options and account functions. They must provide a mini account with a minimum of deposits and a standard account. Thus, anyone who is interested in Forex, will be able to trade on the level at which they will be comfortable.