PortalKota – What is Forex Trading?. What is forex trading the term forex is short for foreign exchange market, which is the place where different currencies are exchanged in a continuous fashion by millions of people all over the world.
Two hours to travel from one country to another must exchange currencies in order to pay for a local product or service.
A lot of euros would be totally useless to an Italian tourist wishing to visit the Sphinx in Egypt because it is not the locally accepted currency.
What is Forex Trading?
The tourist would have two exchanges euros for the local currency egyption pounds at the existing exchange rate that day, even without boarding a plane residents have one country exchange currencies with another country each time they purchase a foreign product, for example, if you’re living in the US And wan na buy a nice bottle of French wine.
You may pay for ten dollars, but the wine is already been paid for in Euros somewhere along the line.
Either the wine producer or the American importer had to exchange the equivalent value of US dollars USD into euros.
Unlike the New York Stock Exchange or other stock markets, there is no central marketplace for foreign exchange.
Rather, currency trading is conducted electronically, over-the-counter OTC, which means that all transactions occur via computer networks between traders around the world rather than on one centralized exchange.
The market is open, 24 hours a day, five and a half days a week. The need to exchange currencies is the primary reason why the forex market is the largest most liquid financial market in the world.
It outperforms other markets, including the stock market, with an average traded value around US $ 2 billion dollars per day.
So why would anyone trade Forex as three different people and you will get more than three different answers? Of course, right off the bat making money is the most frequently cited reason, and this is a perfectly legitimate motivation.
We all live in a world where money, even if it can’t buy everything, can certainly still make life a lot more enjoyable. There are some people who trade in the forex market because they see it as a form of gambling and betting on the winning number.
It really can be a lot of fun, especially if UN and there are others to trade Forex.
Just for the personal satisfaction of making a trading system work for them and coming out with the results they aim for, we are always satisfied. We make the right choice in come home, the winner.
You see the common factor for why people trade forex is quite simple one way or another. These people are getting whatever it is, they want money, enjoyment or self-satisfaction, or perhaps they are trading for all three reasons.
Forex trading is really a very simple concept when you move along in our lessons you’ll see, the forex trading differs from other means of accomplishing your goals, in that it offers opportunities for success in ways that are unmatched by other activities.
In our next lesson at FX Academy, you will learn these differences and will learn to understand exactly what is traded on the forex markets. Stay tuned.
