Tuesday, August 11, 2009

Forex Successful Currency Trading

The Foreign Exchange - Forex, FX - market is one of the biggest markets today. Daily turnover has skyrocketed from approximately 5 billion USD in 1977, to a staggering 3 trillion (and more) US dollars today. This is more than 40 times the daily turnover of the NASDAQ.


Forex currency trading is attractive to traders as currency markets are cnstantly fluctuating and there is potential to profit whether a currency is going up or down. Traders trade on margin which leverages their potential gains. What also makes it so popular is that there is no centralized location for trading as there is in futures or stocks, as trading occurs around the clock over the telephone and on computer terminals at thousands of locations worldwide.


Currency trading occurs when one country's currency is traded for another country's currency at the prevailing exchange rate. All currency is traded in LOTS. Each lot has a different amount of currency. Currency trading is carried out on a point (or pip) system. Traders are trying to capture points. Depending on the currency, each point is worth a different amount. For example, if the Brittish Pound is worth about $10 per point that is traded per lot and you trade 1 lot and capture 40 points, you make $400.

1 comment:

  1. I would like to recommend that you use the #1 Forex broker - eToro.

    ReplyDelete

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