Forex

What is FOREX?

Forex means Foreign Exchange.

What is Forex Trading?

Forex Trading is buying and selling of Foreign Currencies with the objective of making profit while stock trading involves the buying and selling of stock of company shares with the intention of making profit.

For example, if you buy the shares of company XYZ at N10 per share and the share appreciates to N15 and you sell it, you will make N5 of each share bought with the company shares exchange rate. Same vein, if you buy USD$ at N120 and $ appreciates to N125, and you sell, you will make N5 of each $ you bought, but unlike stocks, interest exchange rate can appreciate within 1 minute of purchase.

It is this frequent change in currencies that Forex Trading take advantage of to make appreciable profit on daily basis. It is possible to make between $500 to $700 each day, or even more depending on the capital you trade with, which currencies are Trades in Forex Market.

About 8 major currencies are traded by the Inter Forex Market. These are United States Dollar вЂ" USD-$

Euro - €

Japanese - Ð'Ґ

Great Britain Pounds - Ð'Ј

New Zealand Dollar вЂ" NZD

Australian Dollar вЂ" AUD

Swiss France вЂ" CHF

Canadian Dollar вЂ" CAS

$ is the most traded currencies with 89% of the Advanced Trades others curries that are termed “exotic” currencies.

When can Forex be traded

Forex can be traded 24 hours a day and 5 days and 2 hours each week. The Forex Market open 10p.m (Nigerian Time) on Sunday and runs till 10p.m on Friday at 10p.m Nigerian time on Friday. There is no Trading on Saturday.

How big is the Forex Market

The Forex Market is the largest financial market if the whole world. Trading between $2 -$3 each day compare to New York stock exchange which is the largest stock market in the world, it will take about 3 months for New York stock exchange to trade what Forex Trades in a day.

Where is Forex Traded?

Forex is traded on the Internet. There is no physical location where people gather together to trade the Forex, all interaction is done electronically via the Internet.

Who are the participants in the Forex Market?

Different categories of people with different motives, participate in this market while some are there to exchange one currency for the other, without profit motive, others especially Forex Traders and Brokers are there to make profit. These include:

- Central Banks of various countries

- Individual & corporate Forex Brokers

- Forex Traders

- Speculators

- Commercial Banks

- Large Corporate Organizations

When is the Best Time to Trade Forex?

Forex can be traded anytime during the week, but from the statistics on the market, Tuesday and Wednesdays are the best time to trade the market. The following data on the curry price moved over the years confirm this trend.

Day Curry Price

When Not to Trade the Forex?

There are times to avoid trading the Forex so as not to loose money.

- International Public Holiday e.g. January 1st, Dec 25

- Specific Holiday in the United State of America- When Banks are closed (since the $USD carry about 89% of the transactions in the Forex market, current price movement is affected when the Banks are closed).

The holidays include:

Thanksgiving Day, Martin Luther King (Jr) Birthday, Labour Day etc

- Afternoon on Fridays (from 4pm on)

What is needed to Trade the Forex

1. You- to be able to make profit on the Forex Market you need to understand how Forex Market works. This is by getting appropriate training. This training can not be acquired by attending seminar of by reading articles on Forex but through hands-on Practical Training.

2. Computer with Internet Connection- with your Computer and Internet Connection, you can trade from anywhere. There is no need for office space. You can trade from comfort of your bedroom.

Who can trade the Forex

Virtually anybody can learn how to trade the Forex. You do not require extensive knowledge of computer. Once you can click the mouse of the computer, you can trade. Clicking the mouse of the computer can be learnt within one (1) hour even if you are new to computer. It does not require typing on the computer.

This business is suitable for:

- Unemployed Graduates

- Students

- Employed who require financial enhancement

It can be done on full-time or part time.

Computer Requirements

Forex trading does not require a lot of capital, with about $100 (N12, 000) you can start.

Forex Trading is a unique business in which your broker borrows money to trade without charging interest.

All brokers provide their trades’ financial “leverage” without interest. For example if you deposit $100 and your broker provides you with 1: 500 leverage, it means you can execute trade with $50,000, with $1,000 deposit, you can execute up to $500, 000 worth of Trade.

Opportunity to learn how to trade without your money. Forex Brokers give opportunity for you to learn how to trade by giving your free practice Accounts. This account works like real Account except that you cannot withdraw profit. You make using the Account. All brokers offer this account

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