What is Forex?
Forex also known as the Foreign Exchange Market is a decentralized global market where all of the worlds major currencies such as USD, EUR, GBP, JPY, NZD, AUD, CAD etc. are traded by Central Banks, Hedge funds, Investment Managers, financial institutions, individual investors & soon to be you!
How does Foreign Exchange work?
If you go to Europe to convert GBP dollars to Euors on:
August 1, 2019 : 1 GBP = 0.90225 EURO
The difference from January 1, 2019 to August 1, 2019 is 0.24405 pips
If you go to London to convert US dollars to Pounds on:
August 1, 2019 : 1 USD = 0.82280 GBP
The difference from January 1, 2019 to August 1, 2019 is 0.03804 pips etc.
Doesn’t seem like much right? I know. But on a Standard Lot 0.03804 pips is equal to $3,804 & 0.24405 pips is equal to $24,405. That’s the potential profits traders could’ve made on those little differences in 7 months & there are 28 Major pairs excluding others that you can trade.
With an internet connection, you are able to trade anywhere in the world with the big banks & Top investors from your laptop or phone! In addition, the market is open 24 Hours from Sunday to Friday! So imagine being a trader and catching a consistent 100 pips a day. You’ll have $500 at the end of the week, all made from your phone.
Forex is the most liquid market in the entire world with volumes of approximately $5.3 Trillion traded a day. That’s more volume than all of the world stock markets combined.
Exchange rates are always fluctuating and as forex traders, we use fundamentals, risk management, discipline, and patience to find opportunities & catch pips to secure consistent profits.
The great thing about forex is that you can secure profits on markets going up or down. There aren’t any limits as to how many trades you can make per day & your brokers offer you leverage to your account.
You may lose money but your account will never go below $0 or you’d be in a situation where you’d have to owe money to your broker. For trades over-leveraged & going bad, your broker will stop you out with a loss to your account leaving you with a balance, helping you to maintain an account before losing all.
Yeah, you may lose money, but you aren’t in it to lose money. With proper risk management & discipline, you can lose trades & still be consistently winning trades after trades being profitable with a 3% risk & a 1:3 risk to reward ratio.
Apply the same fundamentals with proper risk management and also trade Stocks, Crypto, Indices, Metal, Energy... Pretty much anything you want all on the same Trading Platform.
Welcome to the start of a new journey!