What Forex Is And How It Works

The Foreign Exchange or Forex is the trading of one currency for another.
It is estimated that 3 trillion in dollar value is traded worldwide on a daily basis. The Foreign Exchange is the largest financial market in the world.The main operating centers for trading are New York, London, Frankfurt, Tokyo and Sydney.

So who is trading in Forex? Roughly 5000 banks (public and private), Hedgers, (people who play both sides of the market to protect their product in travel between different countries) and Speculators (traders for profit). Compared to more popular vehicles (stocks,bonds,commodities) the FX market has some pretty big advantages.

1) Less to learn. The main currencies traded are: EUR/USD (euro/dollar), USD/JPY (dollar/Japanese yen), GBP/USD (British pound/dollar) and the USD/CHF (dollar/Swiss franc). Compared to 8000 stocks and bonds.

2) No more "stock tips" that never work out. Pure analysis is what will work the best.

3) Less overall out of pocket expense needed to start.

4) FX has no commissions or expiring contracts.

5) 24 hour trading.

6) 100:1 Leverage. A deposit of 10,000 USD can command position of up to one million USD with leverage. This allows you to take advantage of the miniscule fluctuations or "pips".

7) With the technology of the signal programs available now, there has never been a better time to begin.

Forex has alot of opportunity for big profits. As with any investment opportunity, do your own research and analysis to find the program that suits you best. Need more information on Forex trading? Visit our link in our Bio box.
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