What is Forex Part Three

Types of forex markets

The three markets available to a forex trader are the spot currency market, the currency futures exchange, and therefore the currency commodities exchange.

The commodities exchange is currently the most important exchange market.

The spot forex market is where currencies are bought and sold instantly at their current price and at an agreed rate of exchange. to induce aware of the licensed trading companies, you’ll be able to view the reliable trading companies in Asian nation.

Usually these exchanges are facilitated by a broker or a bank.

In a spot retail transaction, as an example, you wish to shop for EURUSD at $ 1,000 of it (1 micro lot) immediately at the terms, minus the spread or commission cost, and sell it later with a profit or loss calculated in pips and dollars.

You may only have $ 1000 in your account, but since a typical forex broker will offer you a leverage of 100: 1, you merely need a margin of $ 10 within the trading account with a size of $ 1000 per unit.

Futures Currency commodities exchange

In this market, contracts are bought and sold supported standard volume (much larger than the spot currency market) and settlement history generally commodity markets.

Traders comply with buy or sell a set amount of a selected currency at a set rate of exchange on a specified future date.

The futures markets are just like the futures markets, but the difference between them is that the terms of the contract between the 2 parties are determined by the parties involved only and may not be supported the commodity market.

Where to trade forex:

The Forex market doesn’t have a physical headquarters just like the big apple stock market on Wall Street or the Chicago Board of change Chicago, Forex operates electronically within the retail interchange market outside the exchange, which operates entirely through a network of banks and brokers.

As mentioned earlier, the forex market could be a decentralized market that’s operated electronically in order that forex traders can trade anywhere, anytime online.

It is not necessary for the day to start out and end supported the business hours or a particular bank located in an exceedingly certain period of your time, rather trading takes place 24 hours for five days every week, because there are always banks that operate and offer rates in certain places and different time periods round the world.

Deals are executed fast thanks to the large liquidity and internet-based platform (no exchanges, no auctions, no middlemen).

Who Trade Forex?

Forex is that the largest market within the world, and is twice the biggest of all global stock and futures markets combined.

Not long ago, this field was monopolized by the rich exclusively, with banks sending deposits round the world, and financial hedge companies exposing deposits to currency risk in numerous countries or transferring their profits.

The deregulation of the 1990s, together with technological advancement through the web, changed traditional trading methods and made it easy and broad for us new traders to achieve access to the Forex scalping opportunity. the quantity and size of huge and tiny traders increased so as to require advantage of small fluctuations in exchange rates for the aim of speculation and profit.

Advantages of Forex Trading:

One of the foremost liquid financial markets (over 4 trillion dollars are traded daily)
You can trade anywhere, anytime, over the net
Instant execution of trades with minimal price slippage
You can trade 24 hours, 5 days per week. From Sunday evening until Friday afternoon.
The market can’t be confined to or manipulated by the most important participants
The ability to shop for and sell, whether the trend is up or down
Hedges: you’ll hold buy and sell positions within the same currency
Most brokers only charge the spread, not the commission
Each of those reasons in itself makes forex more attractive than other markets, and when combined together, there’s no competition and forex provides more opportunities than other markets with much lower amounts and start-up costs.

All these advantages don’t mean that forex is incredibly easy and simple, the exchange trading environment has advantages over others.

However, all markets are dangerous for all traders, especially for inexperienced traders, and forex isn’t any exception.

In fact, the chances of losing in Forex are greater than the chances of profit.

If you are doing not have sufficient experience to conduct dealings, be prepared to lose your money in no time.

Forex graves are stuffed with remnants of inexperienced traders that skillful traders devour.

Our mission is to supply you with the knowledge, advice and techniques to assist you successfully complete the trading process.

All you’ve got to try and do is take the time to hone your trading skills and practice demo accounts with fake money.

After you’re sure that you just are fully prepared for trading, you’ll be able to start trading on real accounts.

Even then, it’s recommended to trade with the tiniest lot size.

It is possible to benefit from this market, but on the opposite hand there are many risks and fluctuations that you simply need to take into consideration, and also the more you learn and practice the more, the higher your chances of survival and profit.