The foreign exchange market (Forex) offers many advantages to investors. But you need to know where to begin. This short guide will give you the Forex basics, so you can quickly start participating in this fast growing market.
You may have been hearing about the foreign exchange market (Forex) and the investment advantages it offers. You would like to try it out, but don't know where to start. This short guide will give you the basics in Forex and tell you what you need to participate in this fast growing field.
In the past, foreign exchange trading was limited to large players such as national banks and multi-national corporations. In the 1980's the rules were changed to allow smaller investors to participate using margin accounts.
Beginning traders are strongly advised get accustomed to Forex by doing "paper trades" for a period of time. Paper trades are practice transactions that don't involve real capital. Forex traders usually require a broker to handle transactions. Most brokers are reputable and are associated with large financial institutions such as banks.
Trades are commission free, meaning that you can make many trades in one day without worrying about incurring high brokerage fees. Brokers make their money on the 'spread' — the difference between bid and ask prices.
