So What is Forex?
One of the best ways to generate income on the internet is trading on the Foreign exchange market (or Forex in short). Traders in Forex can make lots of money by investing in many different foreign currencies within the ease and comfort of their own home.
Forex is the largest and the most liquid market in the world and it’s open 24 hours a day and more than 5 days a week. Each day, transactions in the Foreign exchange market begin from the eastern places of the planet like Sydney and Tokyo and gradually move to the other corner of the planet going to Europe and New York.
The most important currencies that are traded in forex are the US Dollar, Euro, Japanese Yen, Swiss Franc, and British Pound.
In the past, only banks, governments, large financial institutions and big investors like George Soros were allowed to participate in Forex Market because of the restrictions and the huge amount of money required to trade in Forex. This changed after 1998 when Forex market was opened to the public and from then anyone with even small amounts of money can trade foreign currencies. Another thing that helped small investors to participate in Forex is the expansion of the internet and the ability to trade from every corner of the planet.
Of course you should know that Forex is a high risk investment and you should not risk more than what you afford to lose. There are specific principles that have to be followed to achieve success in Forex.
To begin with, it is advisable to learn the basics of forex market like the nature and characteristics of trading in the Forex and then start building your trading knowledge and skills to a more advance level. You can find many websites that offer lessons and tutorials about online forex trading. Some other sources of knowledge are online or offline seminars about forex trading and many e-books that you can find on the internet. Even if you learn a lot of things about Forex you should first become familiar with the Forex market before start trading with your own money, for that reason you should open a demo account to a forex broker company (most forex broker companies offer this for free!) and practice your skills in a real situation.
As a trader it is of major importance to have a trading strategy and follow a system that you trust. You can find many free systems and paid systems on the internet or develop your own later based on your experience and what fits you. In order to choose a system you should know what fits your character and economic situation for that reason you should be able to answer the following questions:
- How much money you can invest?
- How much money you really want to earn?
- How much money you are prepared to lose?
- How often can you trade?
- Are your emotions affecting your judgmet? (If emotions like fear, hope and greed effect your judgment you should follow a mechanical system that doesn’t require your own judgment for every trade. Of course you should judge before you start trading if this system is profitable in the long run by back testing it.
You can find more information about forex in this site and we hope that we will enrich your knowledge in forex and help you in your path to success…