WHAT IS FOREX???

fxtrait

Active Trader
May 26, 2019
10
4
32
What is forex actually?
A term heard by many yet most still find it confusing to understand, simply put, forex means foreign exhange which refers to the process of changing one currency into another currency. This might still sound confusing to you but no worries, watch the video below and get a full insight into the world of forex and how it works.

Before we continue with the lecture i advice you watch the video below because after watching the video below you should be able to understand the basics of forex and all it entails.




Forex, also known as foreign exchange, FX or currency trading, is a decentralized global market where all the world’s currencies trade.

The forex market is the largest, most liquid market in the world with an average daily trading volume exceeding $5 trillion. All the world’s combined stock markets don’t even come close to this. But what does that mean to you? Take a closer look at forex trading and you may find some exciting trading opportunities unavailable with other investments.

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If you’ve ever traveled overseas, you’ve made a forex transaction. Take a trip to France and you convert your pounds into euros. When you do this, the forex exchange rate between the two currencies—based on supply and demand—determines how many euros you get for your pounds. And the exchange rate fluctuates continuously.

A single pound on Monday could get you 1.19 euros. On Tuesday, 1.20 euros. This tiny change may not seem like a big deal. But think of it on a bigger scale. A large international company may need to pay overseas employees.

Imagine what that could do to the bottom line if, like in the example above, simply exchanging one currency for another costs you more depending on when you do it? These few pennies add up quickly. In both cases, you—as a traveler or a business owner—may want to hold your money until the forex exchange rate is more favorable.

An easier example like in the video, lets say on your journey after arriving the aiport you go up to the counter and notice a screen displaying different exchange rates for different currencies. You find “Japanese yen” and think to yourself, “WOW! My one dollar is worth 100 yen?! And I have ten dollars! I’m going to be rich!!!”

When you do this, you’ve essentially participated in the forex market! You’ve exchanged one currency for another. Or in forex trading terms, assuming you’re an American visiting Japan, you’ve sold dollars and bought yen.

Before you fly back home, you stop by the currency exchange booth to exchange the yen that you miraculously have left over (Tokyo is expensive!) and notice the exchange rates have changed.

*It’s these changes in the exchanges rates that allow you to make money in the foreign exchange market.

“IT’S ALL IN THE EXCHANGE”

IN THE NEXT COMMENT BELOW WE WILL BE TALKING ABOUT THE
OPPORTUNITIES IN FOREX
 
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Reactions: Chatterbox boy21

Akwin

Trader
Oct 12, 2020
52
10
9
31
Valuable thread, it's so beneficial just want to ask if forex trading profitable and how risky it is? Your reply is highly appreciated
 

Resolve

Master Trader
Dec 7, 2013
802
8
54
Valuable thread, it's so beneficial just want to ask if forex trading profitable and how risky it is? Your reply is highly appreciated
In Forex trading you can get a complete loss of your trading capital in a very short span of time.
 

Dora_WalletInvestor

Active Trader
Aug 17, 2020
285
43
44
In Forex trading you can get a complete loss of your trading capital in a very short span of time.
That's true, but this is not an accurate representation of what Forex is like. If you go into it with enough knowledge and be extra careful about managing your risks, you can avoid losing your whole capital.