The forex market is the exchange of foreign currencies. People make money by buying one currency, waiting for it to gain value and then selling it again. The market has become more accessible over the last few years as the internet has helped people gain greater access to both information and to brokers who help by lending money for trades.
The forex market is an over-the-counter market where people can trade currencies. It’s a decentralized version of the booths you see at airports where you can exchange currency, however, these markets move much faster and the price is constantly changing. It is open 24 hours a day and seven days a week and is a worldwide market. People in Japan, Europe and the Americas can all be trading in the same market place at the same time.
One of the big advantages forex has over stocks is that there is always an upside to the market. Whenever one currency is going down there is always another one that is going up. Unlike the stock market there is never a time when the value of everything drops, instead the values are relative, so whenever the dollar is falling it is falling in relation to something else. This makes it a great place for money because you will never get caught up in the whipsaws of the stock market. Instead, investors have the opportunity to take advantage of a rising market even when stocks and other markets are falling.
The forex market is the largest market in the world and traders from all over the world participate. There are three big centers in Asia, Europe and the USA, but with an internet connection and some specialized software, traders from anywhere in the world can make money.
The market is open 24 hours a day and seven days a week so you can pick the time of day that works best for you. There is nothing to stop you placing a trade a midnight or in the small hours of the morning. The internet also means you are not bound by the hours of a broker, giving you the opportunity to trade when and where you want. This makes accessing the market great for people with jobs, kids or other scheduling challenges.
Brokers will allow individual traders leverage on their accounts. We’ll discuss leverage in a second, but what this means for the investor is that getting involved in the forex market doesn’t have to require a lot of capital. Investors can put their own money into an account without having to borrow money from friends, family, or a bank, and use the leverage they have with their broker to borrow trading capital. This means the investor can realize much greater profits than they could with trading their own money alone, but it can also expose investors to greater risk. Fortunately, investors who are smart with their leverage use it to help make big profits trading forex.
As with all investing your potential profit varies widely depending on the amount of money you are able to invest. However, good forex traders can expect a return of about 20% per year if they are careful and have both discipline with their money and respect for the market. Even making 10% would make the forex market a better place for your money than most other forms of long term investment.
Getting started with forex is as easy as opening an account with a broker. However, you should be very careful when you first start to trade because leverage works both ways and you can sometimes leverage your losses into a huge loss of capital. Lucror FX offer demo accounts through which you can trade the real market with play money until you are consistently profitable and ready to put your own savings on the line.
Forex is a great place to make some money and has a few major advantages over stocks, bonds and other forms of long term investments. However, it can be risky so make sure you learn how the market behaves and how to take advantage of those moves before you commit any real money. Contact Lucror FX at www.lucrorfx.com to get start trading today!