Why it is important to learn Forex trading? The answer is quite simple actually-because Forex trading offers a number of exceptional advantages over other ways of financial trading.
Learn Forex trading - The basics
- Forex market is the biggest financial market in the world with more than 4 trillion dollars traded everyday around the world.
- Forex trading offers highest liquidity to the traders due to the huge size of the market. Therefore entering and exiting any trade is easy.
- Forex market is open 24 hours a day offering high flexibility to the traders.
- Forex trading offers the facility of trading with leverages i.e. trading on high orders with low margin requirements.
- It is very easy to start Forex trading as only a few hundred dollars are required to open a trading account.
- Forex trading needs skills to trade as most of the beginners fail due to the lack of knowledge and training. That is why it is important to learn Forex trading for a beginner.
- Through learning it is possible to understand the different elements of Forex trading and learn strategies needed for becoming a better Forex trader.
What is Forex?
Forex stands for Foreign exchange and is also referred as FX. Forex market is the largest financial market in the world with a daily turnover of more than 4 trillion dollars. Forex trading refers to the simultaneous buying of one currency and selling another currency in parallel. All the currencies are traded in pairs. For example Euro/USD, USD/JPY etc.
For the traders the most commonly traded currencies offer the majority of the trading opportunities and these currency pairs are called majors. More than 85 percent of the daily transactions involve the trading of the majors which include USD, Japanese Yen, Euro, Swiss Franc, British Pound, Australian dollar and Canadian dollar.
A 24 hour market is there for Forex trading which opens Sunday 5 PM ET to Friday 5 PM ET. It begins each day in Sydney and moves around the globe through Tokyo, London and then New York. Forex trading is not centralized on an exchange as with stock and futures markets.
How to trade Forex?
Trading Forex is easy and simple and all you need to do first is to search a reliable Forex broker. Without a Forex broker, it is not possible to trade Forex as he acts as an intermediary between you as a trader and Forex market. A Forex broker facilitates the execution of trading orders done by you. An online Forex broker provides a software trading platform for you to trade where you can make trade orders online and manage your trade. Advanced Forex platforms may also provide you the facility to learn Forex trading besides giving Forex information and trading with Forex charts.
Trading Forex needs discipline and use of tested strategies with patience. It is not like a gambling game where you can become a millionaire over a night. Therefore it is important to learn Forex trading strategies regularly and have patience.