Foreign exchange trading is the trading of currencies. Most
currencies can be traded. Huge amounts of
currencies are traded 24 hours
a day, 5 days a week. On average $1.9 trillion is traded a day. The
most traded are United States Dollar, Japanese Yen, Euro, Canadian
Dollar, British Pound Sterling, Australian Dollar and Swiss Franc.
Many brokers will let you open an account with a starting
balance of just $250. Though that may seem small, remember you will be
trading on margin. Your $250 investment may let you control $25,000. As
with all investments there are risks so make sure you take the time to
study the markets and your exposure before making your first trades. I
highly recommend that you do some paper trades first to make sure you
have understood how the markets work. No risk training, just write down
the trades you would have done for real and chart the prices. Buy and
sell and see if you have the right strategy before making real trades.
A fast internet connection will allow you to do forex trading
online. Your broker will give you many online tools to allow you to
study the markets: Real time quotes, news feeds:
Visit different broker's websites and compare the services they
offer. Some brokers give you the possibility to open demo accounts. Do
so, to test their software and find the one you like best.
Before you start trading make sure that you have learnt the
terminology: Market Order, Limit Order, Stop Order. You may find the
definitions of these terms and more information at
http://www.forex.value-guides.com/calc-forex.html Calculating Forex
Profits And Losses.
All currencies have standard identifying code used worldwide,
some examples are: EUR (European euros), GBP (United Kingdom pounds),
AUD (Australian dollars). Of course you don't have to know them all but
it may be good to be able to recognize all the major currencies codes so
that you will be able to make quick decisions.
To make sound evaluations, you need information. Follow
carefully the world's current events, economic and political news. You
will be surprised to see how, what may seem to you as insignificant will
cause the currencies markets to fluctuate wildly.
by David Jones
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