Forex Trading – a concise guide.

New to Forex? Don’t have a clue where to start? Well as briefly as possible here’s what you need to know from a Professional Forex Trader What is Forex? Forex (Foreign Exchange) is the market where countries currencies are bought and sold by anyone from Governments down to retail traders like me – and possibly you soon!

How does Forex Work?

Like any market you have people wanting to buy and people wanting to sell. Unlike any other market there is no discernable “product”. You can for example, buy Pork Bellies on the CME, or Shares on the NYSE. but the Forex market simply trades one currency against another. So the British Pound is traded against the US Dollar, or the Japanese Yen against the Euro and so on.

Also unlike any other market there is no actual market; trades are not matched up on a single exchange but are spread around the world on servers. It is also as a result, unregulated; that doesn’t mean it’s “dodgy”, just that everyone trades “in agreement” with everyone else using the accepted methods, rules and customs.

How do you trade Forex?

Until early 2000′s you couldn’t trade (unless you had the odd $1m to trade on the InterBank Market). Brokers appeared who would allow you trade small positions of $100,000 using margin and thus required maybe only $1000 from the trader to hold that position. The advent of online trading and the Internet made all this possible. As time went on the business rapidly expanded and you can now trade “micro lots” of just $10,000 requiring just $10 or $20 as a deposit. In the UK and some other countries (the notable exception being USA) “spread betting” also is a way to trade the Forex Markets.

What do you need to Trade?

stockoptionssimplified.com/forex-the-best-place-to-exchange-your-currency/

With Forex, it’s easy. The Charts are free and perfectly adequate to trade with professionally. The data is free. You can open an account with around $250 and, (yet another huge advantage here) you can trade exactly as I do yet only risk $10 per trade. This gives you the opportunity to learn to trade, with real money, but not risk your future mortgage payments on it! It’s also, from a psychological viewpoint perfect to trade with real money, yet not incur the pain of large losses.

Why doesn’t everyone trade Forex?

Because it’s fantastically risky, you can lose everything you have in 10 minutes, it takes years to learn how to trade it, it requires innate skills and abilities, You can’t do it……. Well these are a few of the reasons so called “traders” or brokers will give you. It’s all lies. YOU can trade, especially Forex but here’s the real reason not many people actually make any money from trading Forex, or most other markets come to that.