Forex is foreign exchange. Currency Market are simply Forex. It’s the market where one currency is traded for another. Some of the market participants exchange foreign currencies for their own. Like Multinational Corporation which has their wages and other expenses in different nations they sell their products in.
However a large part of this market are simply currency traders who make a lot of money on movement in exchange rate, just like stock traders speculate price changes in stocks.
WHY TRADE FOREX
The forex market is by far the biggest and the most popular financial market in the world traded globally by a large number of individuals and organizations. Its average daily trading volume exceeds $5 Trillion. Its 24 hour market, opened from Monday morning in Australia till Friday afternoon in the USA. That means you can trade morning, noon, night. During breakfast or even before you go for your night snack at 3am. No commissions, no exchange fees, no government fees and no brokerage fees.
Most forex brokers earn money from spread, which is different between bid rates and ask rate.
No Middlemen: There are no middlemen between a trader and a broker therefore the trader is at liberty to execute his trade online without having to go through a central exchange, saving time and additional fees.
Leverage gives trader the ability to control much larger total contract value than his initial deposit. As some broker has offer $500 to 1 leverage, you can only deposit $25 to control more than $12000 worth of currencies and start trading straight away.
Free Practice: Most online forex broker’s offer free demo account, practice trading and build your skills or on the real time forex quotes charging services so you can get the fee fluctuating without risking any real money.
WHY NOT TO TRADE FOREX
Well, there really is no reason not to give it a try. I used to think you had to be some kind of genius or a wealthy guy with a degree in Economics to be a successful trader. But it seem that is not the case, I believe everyone can do it and with a little bit of patience, you will be able to do it too.
Christabel Yvonne Ofosu (WiFI)