Welcome to our NEW and EXCITING, FREE education course! 52 lessons once a week! Please share to anyone who may find it of use!
Chapter 1 – What is Forex?
In recent years, Forex trading has become very popular among young people influenced by social media advertisements. The prospects of earning money with only your phone or from anywhere in the world are amongst the main reasons why so many people decided to get involved. Unfortunately, many are still diving headfirst into this brand new world of currency exchange only to find themselves struggling to survive and profit.
We decided to help you in your journey as a retail trader and deliver you this free, easy to understand and comprehensive guide to Forex trading! We believe that our educational series will help you better understand the nature of the Forex market. Remember that knowledge will make you a better, more profitable trader in the long term!
So let us start with today's topic and find out what Forex is!
The Foreign Exchange Market is also often referred to as Forex or FX market and is the largest and most liquid financial market, with a daily volume of $6.6 trillion (2019 Triennial Central Bank Survey of FX and OTC derivatives markets) with 'spot' retail traders making up to 5% of it. Forex is a decentralized market, where you can trade currencies against each other, regardless of where you are based. It allows you to participate and speculate on the future value of the currency pairs you wish to trade.
The reality is, you probably participated in a Forex trade before! You do not need to have an account with a broker or MetaTrader4 platform to do so in life. If you visited a foreign country for a holiday or a business trip and exchanged your money at the airport kiosk, you executed a trade. You bought foreign currency at a given rate and will sell what is left when you head home. You also participate in the Forex transaction each time you buy or sell goods or services from/to another country.
One of the biggest benefits of the Forex market is its availability. It is open 24 hours a day, 5 days a week and is only closed down for a brief time on weekends. It opens on Monday morning in Auckland/Wellington and closes on Friday at the end of the day in New York. It cycles across multiple financial hubs throughout a week:
With the rapid growth of the Internet, the development of trading platforms and online brokers Forex was becoming more and more accessible to retail traders. These enabled approx. 13.9 million people to become online traders (The Modern Trader study; https://brokernotes.co/modern-trader/). With the increasing impact of social media, people are becoming more aware of the possibilities that Forex brings not only as a profitable side hustle but also as a career.
It's become relatively easy for retail traders to start their Forex journey, all you need to have is access to the Internet and trading platform (MetaTrader4 being the most common one) and an account with a broker. Brokers offer various benefits to enable retail traders to benefit more from the market, these include:
small initial deposits to start (as low as $10 with our partner broker EagleFX
leverage for greater flexibility
free demo accounts to practice and learn
wide range of assets to trade including:
desktop and mobile terminals
competitive spreads or commissions
Next week we're going to look into the history of Forex and how it became the market we know today in greater detail. Stay tuned! Make sure to sign up to stay in the loop!
The borning bit...... Trading involves risks, your capital can be lost and more. We NEVER give advice. Our education lessons are based on years of knowledge and opinions you should always double check any facts or figures mentioned.