 |
|||||
|
|||||
What is forex trading?
Definition: Forex Trading is the exchange of one currency for another.
The foreign exchange market allows companies, banks and individuals to buy and sell foreign currencies. Unlike other financial markets, the foreign exchange market has no single location – trading is done globally via telephone and computer links. The Forex market is huge: the trading volume is in excess of 2 trillion USD per day, providing the greatest liquidity to investors.
In the past small investors have had limited access to the lucrative forex market. The Interbank market is no longer the exclusive domain of large players. Technological leaps (such as the state of the art Dealbook360 trading software) have opened up this exciting market to small speculators. Real-time Interbank dealing rates allow the trader to place a buy or sell order and see it executed within a fraction of a second.
There are always buyers and sellers in the forex market. The market absorbs trading volumes. A trader is never stuck in a position due to lack of market interest, volume and/or liquidity.
By 2008 in excess of 20 million individuals like you will be trading currencies as a career.
The Industry
The Inter Bank Foreign Exchange Market (IBFXM or FOREX market) is an international market place where trading takes place on the world’s major currencies such as the United States Dollar, the Swiss Franc, the Euro, the Japanese Yen, and British Pound. The Currency Market is made up of approximately 5000 Trading Institutions. International Banks, Government Central Banks, Commercial Companies, Brokerage firms and Individual Speculators.
Forex trading is not bound to any one floor or specific market and is done electronically between networks of banks continuously over a 24-hour period. There is no centralized location for trading activity and trading occurs over the Internet at locations worldwide.
The advent of the Internet has opened a whole new world for the small investor allowing him to trade this profitable market place from the comfort of his dwelling or office. All trades are calculated on very sophisticated trading software systems and finally executed via a designated dealing desk.
How does Forex compare with other financial markets?
The Forex market is open 24 hours a day, 5.5 days a week. Because of the decentralized clearing of trades and overlap of major markets in Asia, London and the United States, the market remains open, liquid throughout the day, and overnight. Most other markets are dictated by the time zones of their trading locations.
Forex is commission free - most financial markets may incur commissions, clearing-and exchange fees.
There are no restrictions on short selling and stop orders in Forex as there are in the other financial markets.
One 24-hour a day consistent margin rate allows Forex traders to leverage their capital more efficiently with as high as 100-to-one leverage.
With a start up requirement of $2500, Forex trading is much more accessible than other markets with high margin rates and huge capital requirements.
New Clients
Register for a free demo trial on our software and receive the following:
-
Free 30 days demo trading account
-
Free access to our interactive support forum