A Basic Introduction to FOREX Trading

Foreign Exchange or FOREX trading is a direct-access trading of the different foreign currencies. In the past, FOREX trading was just limited to large banks and traders. But today's fast paced living has brought the accessibility of trading FOREX via the internet through the use of online trading platforms.

The various currencies are considered floating exchange rates and they are usually traded in pairs such as Dollar/Yen, Euro/Dollar and others. FOREX's daily transactions involve around 85 % trading of major international currencies.

The four major currency pairs are: US Dollar against Japanese Yen, Euro against US Dollar, US Dollar against Swiss Franc and British Pound against US Dollar, and they are most commonly used currencies for investment. These currency pairs appear in the trading market as USD/JPY, EUR/USD, USD/CHF and GBP/USD respectively. There are also no dividends paid on the international currencies.

FOREX trading is a 24/7 business. The transactions being made by dealers or FOREX brokers run 24 hours a day, seven days a week is essential for the global market. Whether you are a dealer in Europe trading currencies with your Japanese counterpart, the market is active and open anytime. Clients are also able to place take-profits and stop-loss orders with their brokers that can be carried out overnight. Another advantage of the 24/7 market trading with FOREX is that any investor, whether a hustler or a newbie, can enter and exit positions without the hassles.

The FOREX market is the oldest and largest financial market that exists in the world today. It is the most liquid and trading is does not focus on exchange. Major banking centers throughout the globe trade the currencies non-stop which makes it more advantageous than the stock market.

The early years of FOREX trading were only focused on huge traders with the most marketable potentials that amount to millions. The trading market was just limited to speculators with high principals. But nowadays, the currency market offers small-time traders the opportunity to trade even with a small amount of principal. Literally, anyone who has the basic knowledge and training in FOREX can trade in the currency market.

The Foreign Exchange business is as interesting as it sounds. It has been and will always be available throughout the glove. It is one business that never shuts down even on holidays. The liquidity of the business attracts more and more speculators to invest. The technology of today made the FOREX market even better and available through the internet. Now, online trading is possible and anyone with the know-how can be an online FOREX trader in no time.

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