Category Archives: Forex basics

How To Trade CFD On The Forex Market?

How To Trade CFD

 

CFD trading is the biggest financial market having the highest profit potential for the traders. Here are the reasons why a speculator should choose to learn how to trade CFD and open a free CFD trading account instead of trading equities or futures.

  • CFDs are simpler than other kinds of financial trading since there are only 8 major currency pairs to choose from.
  • FX market provides the highest liquidity
  • Availability of Leverage to gear up your trades
  • It is easy to enter or exit any trade in Forex
  • Low amount of money required to start Forex trading

And there are many other benefits

Who Trades On The Forex Market?

forex traders

The Forex market, foreign exchange market, is considered to be the current the biggest financial market in the world. As a matter of fact, the currency market is several times bigger than the stock market. This is the one sector of the financial industry where a certain type of currency is exchanged for another type. There are several unique attributes related to Forex that may be surprising to those who are trading for the first time.

This introductory look at Forex will help you understand why and how more traders are choosing this type of investment.

Understanding Forex

Forex is the exchange rate for the price that is paid for one currency in exchange for another currency. These are the types of exchanges that help to drive the market.

There are over 100 different types of currency in the world. However, most of the common Forex trades and payments are made through the US Dollar, Euro and the Yen. Other commonly traded currencies are the British pound, the Canadian Dollar, the Australian Dollar, the Swiss krona and the Swiss franc.

The currency can be traded through several platforms including:

Everything you need to know about Forex trading

FOREX- FOReignEXchange(FX) market is the biggest and the most liquid financial market on the world, with daily traffic from about  5.300 milliard dollars.

Just for comparison, New York stock market has a daily traffic from “only” 25 milliard dollars.

According to business magazine Forbes, one fourth of world’s billionaires has earned money on Forex, where there is no physical exchange of currencies, but the trading is based on selling and buying foreign currency pairs such as EURUSD, CHFGBP, AUDJPY, etc. You can buy one currency from pair, and other simultaneously sell. Over 85% of daily traffic is based on 7 great world’s currencies.

Forex market is decentralized, where there is no unique place for trading, or central organ that is controlling activities or participants. It is inter-bank market, because it is based on electronic way through banking net of mayor worlds financials centers 24 hours daily, 5 days in week (from Sunday 23:00, till Friday 22:00).

That is very practical for participants, because they can register in time most suitable to them, and can react on currency changes immediately, for difference of other financial markets.

Some other advantages of Forex market are:

-There is no commission, only compensation is “spread”, i.e. difference between buying and selling exchange rate.