Thursday, August 21, 2008

Foreign Exchange Market

The foreign exchange (currency or forex or FX) market exists wherever one currency is traded for another. It is the largest and most liquid financial market in the world, and includes trading between large banks, central banks, currency speculators, multinational corporations, governments, and other financial markets and institutions. The average daily trade in the global forex and related markets currently is almost US$ 4 trillion.

Trading information for beginners

If you’re a new to the forex (foreign exchange) market, you probably have a lot of questions. Making money in a global currency market is an exciting prospect; you’re probably wondering how, and what you need to get started. A lot of information on the internet is geared toward the knowledgeable trader who has at least experienced the stock market. Not everyone has the benefit of Wall Street experience. We are here to help you out if you’re not all that stock savvy and don’t have a financial background.

So, what is foreign currency exchange?

The basic term, foreign currency exchange, is used to explain the exchange of one country’s currency for another’s. If you’ve every traveled out of the country, you probably cashed in your American dollars to find that the trade was nowhere near equal. Forex is the same thing on a much larger scale – it’s similar to the market except it deals in liquid assets at all times. It’s the process of buying and selling cash from nations around the world.

How can foreign currencies be traded?

Currency exchanges can be handled on three different levels. You will need to use a broker or a brokerage firm that allows trades through one of the following:

• The Commodity Futures Trading Commission (CFTC)
• Securities and Exchange Commission (SEC)

There is also what is called the off-exchange (over-the-counter) market. An example of this would be that you return from your vacation from Canada and trade your cash in for American dollars. This is only on a retail level or corporate level. Off-exchange trading is subject to very limited regulatory oversight.

How much money do I need to trade Forex?

It depends on the Forex dealer. Brokers concentrated in the Forex market can set their own minimum accounts and are allowed to set their own fees and rate schedules. You’ll need to ask your dealer how much money it’s going to cost you initially.

Many dealers will require a security deposit (a “margin”) to cover future transaction fees. When you choose a broker, make sure that you look over the fees and schedules carefully before you deposit any money. It is important to understand your broker’s capabilities, as well, before handling any transactions through their firm.

These are just a few basic facts about the Forex market to get you started. Trading foreign currencies can be an exhilarating experience when you’ve begun making money, but it is important to get an education before you start out. This website has a wealth of information for the new Forex trader, including tips and strategies. It is highly encouraged that you read up to explore the possibilities of trading in a worldwide environment.

2 comments:

zamz said...

good explanation for beginners

Debt Analyst said...

Hi,

Excellent blog, I enjoy reading your posts. This is to let you and your readers know about our Commercial and Business debt affiliate program (http://bit.ly/bRff7F) or our Personal unsecured debt affiliate program ( http://bit.ly/9PJIQ2).


Anyone with a website or blog can promote our services. Our services are offered in the USA and Canada and commissions are paid in US dollars.


Earn From Referring People Who Need Debt Help:

Every time a person you refer to the website gets a free evaluation and signs up for the program, you earn a commission.



Earn From Referring Businesses Who Need Debt Help:

Every time a small business with a minimum of $25,000 in debt you refer to the website gets a free evaluation and signs up for the program, you earn a commission.



Earn From Referring Other Affiliates:

Are you active in affiliate forums? Do you know other webmasters who have a financial related website that attracts visitors who may be in need of debt relief? Are you in contact with CPAs who know of businesses in debt? Do you have an organization of people looking to supplement their income as affiliates?

If so, then refer them and earn!

Best Regards,
Mike Wallens
debtanalyst101@gmail.com
http://debtsettlementbeware.blogspot.com/