Have you ever heard of the term “Forex Trading”, but to this day, that phrase seems to carry a particular mystery with it? Not quite sure what it is, other than including some foreign currencies?
Don’t worry. Many people are still discovering the magic of Forex trading and are starting to be interested in this type of online business for several reasons. First of all, it is a job that does not require too much investment and prior knowledge.
Future traders should only make sure that he has a stable internet connection, a basic knowledge of technology, and a willingness to be informed and work hard.
If you are also willing to learn more about what Forex trading represents, you are at the right place! We will start from the basic definition and then explain each important term briefly and clearly!
Forex trading – definition and explanation
The word “Forex” is an acronym that originated from two different words “, foreign” and “exchange”. In this regard, Forex trading logically implies trading foreign currencies in the Forex market.
For those who don’t know, Forex Market, or Foreign Exchange Market, is currently the most significant, decentralized financial market globally, with an incredible $ 6.6 trillion daily tournament! Trading on the market is always done in currency pairs, where EUR/USD are currently the most common.
Since the Foreign exchange market is available to traders 24 hours, usually 5.5 days a week, it’s no wonder why more and more enthusiastic individuals are attracted to it.
What is a Forex broker?
A Forex broker refers to a financial service company responsible for allowing traders secure and straightforward access to platforms for foreign currency exchange. Traders are opening their accounts with trusted and regulated Forex brokers that enable them safe access and a guarantee that their tradings will be secure from any potential cyber-attacks.
To choose a quality broker, traders must check their regulation by a financial regulatory body, since without one, they cannot be sure whether a broker is trustworthy or not.
Learn what is the Forex Compounding Calculator
Once they open a brokerage account, what also enables traders to become more successful is a high-quality Forex Compounding Calculator that helps them calculate several crucial things. First of all, that calculator is responsible for calculating:
- Interest earnings over the investment periods
- Total profit including reinvestment
- The account balance
How do traders make money with Forex trading?
Traders from all over the world are making money once the currency they buy increases. So, what’s happening is that traders are betting that the value of one particular currency of their interest will increase compared to another one in the future.
If you’re wondering how much one Forex trader can make, the average salary of a Forex trader in America is currently $98,652 per year.
Simple steps for starting a Forex trading career
There are some crucial steps on how to get started with Forex trading:
- Inform yourself about the Forex in general. Please find all the relevant information to help you understand how it works.
- Find a reputable and regulated Forex broker.
- Open a demo account to practice trading and gain experience.
- After a couple of days or weeks, open a real broker account and start small.
- Choose the right Forex trading strategy that will help you achieve your goals.
- Pick one currency pair you wish to trade. Try several ones before that.
- Keep learning and trying until you fully understand the Forex market.