Another way to make money on internet is to be an online forex trader or we call it retail forex trader.We can choose any online forex broker and register with them to open new real account.We can open demo account with virtual money and trade with demo account as a training at no limited time before we start trade at real account with real money.

The Forex Exchange is the largest financial market in the world where the currency of one nation is traded and always traded in pairs.The currency pairs are traded against the US Dollar (USD) called the majors or majors pairs.The major currency pairs are the Euro (EUR/USD),the British Pound (GBP/USD),the Japenese Yen (USD/JPY) and the Swiss Franc (USD/CHF). Others Pairs called cross pairs are the Euro/Yen (EUR/JPY), the British Pound/Yen (GBP/JPY),the Euro/British Pound (EUR/GBP) and more than 50 currency pairs are traded.The forex market is a 24hour market from Sunday evening to Friday afternoon EST.The forex market is an over the counter (OTC) or 'interbank' market and its not centralized on an exchange.

Forex trading start in Wellington,New Zealand followed Sydney, Australia, Tokyo Japan,Hong Kong,Singapore also known as Asian Market.In couple of hours they followed by Paris,Rom and London known as London market.Five hours later it is followed by New York US known as US market and start again in Wellington,New Zealand for new trading day.

Trade Forex

The Foreign Exchange market or we call forex can be traded as an online trade on the internet or by telephone at thousands of location over the world.Before we place our trade we must be understand several topics relevent.The first one is about the forex quotes.In forex trading,currency traded in pairs, for example, Euro over US Dollar, EUR/USD.

The first currency,the Euro called the base currency and second currency,the USD is called quote currency.We often see a two sided quote,consisting of a 'bid' and 'ask'.The 'bid' is the price at which we can sell the base currency,at the same time buying the quote currency.The another one is the'ask' that the price at which we can buy the base currency,at the same time selling quote currency.In the forex market price are quotes in 'pip'.Pip stands for 'percentage in point' and is the fourth decimal point which is 1/100 of 1%.

A 'spread' is the difference between the 'bid' and the 'ask' price,for example in EUR/USD a 3 pips spread is quote as 1.2500/1.2503. The bid/ask spread increases when there is uncertainty about what is going to happen in the market.

In online forex trading,one of the main attraction of this market for many traders is 'Leverage' trading or trading on 'margin' that we are not required to put up the full value of the position which is very different in forex than it does in stocks.With stocks, trading on margin means trader can borrow up to 50% of a stocks value to buy that stock but must pay interest to brokerage firm of the amount borrowed.In forex,margin is the minimum required balance to place a trade.The money we deposit in forex account acts as collateral for trades,call margin, is typically 1% of the value of the position and we pay no interest.  

Disclaimer & Risk Warning

All trading involves risk. Should not trade with money cannot afford to lose. The content of this page are for general information purposes only. Although every effort has been made to assure accuracy,can assume no responsibility for errors or omissions. Examples are provided for illustrative purposes only and should not be construed as investment advice or strategy. Past performance is not indicative future results.

Popular Posts