Before starting to operate in the International Market of Foreign Exchange (Forex or FX), it is important to know its strongest features.
One of the main advantages of the Forex Trading is the ability to profit when prices go up so much as when they go down. In addition, there are no fees per transaction, although there is a difference, or spread, between the bid price and the sell price.
In this section we summarize the basics that you need to know about the Forex Market.
The International Foreign Exchange Market is the largest financial market in the world. Every day, 3.2 trillion USD are traded in different currencies around the globe. This makes the market more fluid, attractive and lucrative in the world.
The Forex Trading is constantly influenced by major events in the global economy, but also by political events or even by external factors such as climate, natural disasters and even terrorism. The Forex Market allows buying and selling currencies for profit with the differences between the exchange rates.
Currency transactions is very simple, as the procedures are essentially the same as when operating in any other financial market. Investing in Forex is simple for any operator who has already participated in other markets. The Forex market is unique compared to any other financial market. Operations are conducted 24 hours a day, 5 days a week.
Forex currencies are traded in pairs, for example EUR / USD (euro against the dollar), USD / JPY (dollar against the yen), GPB / USD (Pound against the dollar), USD / CHF (U.S. dollar against the Swiss Franc).
The first currency is called “base” (the currency you buy), while the second is known as “quote” (the currency you sell). For example, if you buy EUR / USD are buying euros and selling dollars. It is important to note that Forex is not a physical exchange of currencies. This physical change is carried out by banks and exchange houses specializing in change and currency conversions.
It’s very important to know that there are robots – called Expert Advisors – that operate automatically for you with truly amazing results, but should not rely on any robot you find. After all, your account is at risk.