About Forex

What is forex?

FOREX or Foreign Exchange market is the world largest financial market, where currency of one country is exchanged with another country through currency exchange rate system. Trader’s purpose is to get the profit as the result of foreign currencies purchase and sale. From latest assessment, Forex trading daily constitution is approximately average from 1.5 trillion to 2.5 trillion. . The free-floating of currencies being in the market turnover are determined by the supply and demand. The currency rate is actually run through telecommunication all over the network of banks 24 hours a day from 00:00 GMT on Monday to 10:00 pm GMT on Friday. Importance of human society event in the sphere of economy strongly influences the currency market. Traders gain the profit from the fluctuations in accordance with an agreed principle “buy cheaper- sell higher” or “sell higher-buy cheaper”. Forex is a continuously changing number financial system which exclusively create high trade turnover to all individual and corporative traders with an ensured liquidity of traded currencies. Due to the high potential profitability, therefore the higher risk should be essentially considered. Traders can only be the successful forex investors by going through proper training including an understanding of forex structure and types, the common techniques of analysis, the factors influencing currencies and potential risks, high confident prediction of the market movements with the trading tools and data. There are lots of simulation trading software on web, you can simply choose anyone of them for self training. This will help you to be in a better scenario. Most of the trading providers have the toll free phone number, so just call them up! Ask them question! Learn from them! Some of them may take initiative to consult you, so do write down the question from time to time.

There are many countries in world; so results different currency pairs. Among all of them, these are the popular in currency trading:

EUR/USD, USD/JPY, GBP/USD, USD/CHF, EUR/CHF, AUD/USD, USD/CAD, NZD/USD, EUR/GBP, EUR/JPY, GBP/JPY, CHF/JPY, GBP/CHF, EUR/AUD, EUR/CAD, AUD/CAD, AUD/JPY, CAD/JPY, NZD/JPY, GBP/AUD, AUD/NZD
Five Major Currencies are:

U.S dollar - The United States dollar is the world's main currency – an universal measure to evaluate any other currency traded on Forex.

Euro- Euro was designed to become the premier currency in trading by simply being quoted in American terms. Like the U.S. dollar, the euro has a strong international presence stemming from members of the European Monetary Union.

Japanese Yen- The Japanese yen is the third most traded currency in the world; it has a much smaller international presence than the U.S. dollar or the euro. The yen is very liquid around the world, practically around the clock.

British Pound - Until the end of World War II, the pound was the currency of reference. The currency is heavily traded against the euro and the U.S. dollar, but has a spotty presence against other currencies.After the introduction of the euro, Bank of England is attempting to bring the high U.K. rates closer to the lower rates in the euro zone.

Swiss Franc - Swiss franc is the only currency of a major European country that belongs neither to the European Monetary Union nor to the G-7 countries. Although the Swiss economy is relatively small, the Swiss franc is one of the four major currencies, closely resembling the strength and quality of the Swiss economy and finance.

To have a well focusing, you have to concentrate on less than 5 currency pairs( preferred the U.S. cross-currency pairs.)

Some traders see forex as a business, and some see it as a fortune. And even some traders think forex is an art. But anyway, its highly recommended to use pivot system in your trading plan or else you are trading blind.

What is Forex?

Abbr. "FOREX" stands for Foreign Exchange, an exchange of currencies. When a person comes to trade currencies, e.g. buy one currency and sell another one - it is called currency exchange trading, or simply known as Forex.

Because the value of each currency always on the move, it fluctuates depending on the local and global economic factors, there is always an opportunity to profit on those changes/fluctuations - it is called currency speculation.


Euro, US dollar, Swiss Frank, British Pound and Japanese Yen - these are the most traded currencies in Forex. Of course, trading is not limited to those currencies, Forex offers variety of currencies one can trade.

If to describe in simple words how individuals trade Forex it would look next way:

Forex trading in its prevailing volume is done online.
A person finds a Forex broker, opens a trading account with the broker and deposits money.
Forex broker provides to trader so called Forex trading platform - an application, a working environment, where trader buys and sells currencies, dealing online - in other words he speculates to make money on the difference of currency rates.

In Forex currencies are traded in pairs.

EUR/USD, GBP/USD, AUD/JPY, USD/CHF and so on.
FOREX

The first currency in the exchange pair is referred to as the base currency and the second as the quote currency.
For example, EUR/USD exchange rate = 1.400
Here the price of the Euro is expressed in US dollars: 1 euro = 1.400 dollars
The exchange rate tells to trader how much of the quote currency should be paid to obtain one unit of the base currency.


A Quick Overview of FOREX


FOREX is a spot market, where foreign currencies are traded - bought and sold for profit.

FOREX is a worldwide currency speculation arena with no centralized place for trading and exchange.

FOREX is a huge market with trillions dollars turnover a day and the largest investors - banks, hedge funds, investment companies and so on.

FOREX is open to individual retail investors - Forex traders - through the services of Forex brokerage companies that provide an access to the currency exchange market and take care of buying and selling orders of their clients.

FOREX is a 24 hour market that is traded every day all year round, except for holidays.

FOREX allows trading over 150 foreign currency pairs, among which the most traded are: EURUSD, GBPUSD, USDJPY, AUDUSD, USDCHF, USDCAD and GBPJPY.

FOREX trading is based on technical (price charts) and fundamental (news, economic events) analysis.

FOREX is an online stay-at-home type of business for individual investors.

FOREX is an attractive financial instrument, which can be mastered by any person with any kind of education and/or social status.

FOREX is a type of market which nowadays can also be traded by automated online expert advisors without any human intervention.

FOREX is an alternative type of investment, which unlike any other investment carries one of the largest financial risks.

FOREX is a trading arena, where in order to succeed a trader needs to learn the rules of the market, its trends, moves and behavior, and be able to apply the knowledge under real trading conditions.

FOREX is difficult to trade without a trading method - a trading strategy or system.

FOREX is a fast growing industry, and by directly dealing with money it also became
a lucrative business to various scam dealers. Novice traders should be alert about any offers in Forex which sound too good to be true.

Finally, FOREX should never be associated with quick and easy money.

Forex market and its players

What is Forex (Foreign Exchange)?

Foreign Exchange (FOREX) is the arena where a nation's currency is exchanged for that of another. The foreign exchange market is the largest financial market in the world, with the equivalent of over $1.9 trillion changing hands daily; more than three times the aggregate amount of the US Equity and Treasury markets combined. Unlike other financial markets, the Forex market has no physical location and no central exchange (off-exchange). It operates through a global network of banks, corporations and individuals trading one currency for another. The lack of a physical exchange enables the Forex market to operate on a 24-hour basis, spanning from one zone to another in all the major financial centers.

Traditionally, retail investors' only means of gaining access to the foreign exchange market was through banks that transacted large amounts of currencies for commercial and investment purposes. Trading volume has increased rapidly over time, especially after exchange rates were allowed to float freely in 1971. Today, importers and exporters, international portfolio managers, multinational corporations, speculators, day traders, long-term holders and hedge funds all use the FOREX market to pay for goods and services, transact in financial assets or to reduce the risk of currency movements by hedging their exposure in other markets.

MG Financial, now operating in over 100 countries, serves all manner of clients, comprising speculators and strategic traders. Whether it’s day-traders looking for short-term gains, or fund managers wanting to hedge their non-US assets, MG's DealStation™ allows them to participate in FOREX trading by providing a combination of live quotes, Real-Time charts, and news and analysis that attracts traders with an orientation towards fundamental and/or technical analysis.