Forex, i.e. Foreign Exchange, is an international exchange market. Currency rates are constantly moving in the Forex market under the effect of various factors, and banks, investment funds, exporters, importers, large and smaller businesses as well as individuals trade a currency against another there.
Some Forex operations are conducted to serve international trade and capital flows, the others are performed to make a profit from exchange rates change. The first thing individuals are interested in is an opportunity to earn in the Forex. That is the issue this article deals with.
Trading in Forex, or Forex trading, means execution of foreign exchange. To trade in Forex, you just need an Internet connected computer and a small opening capital. The larger the opening capital, the more profit a trader may expect to gain.
A Forex trader is a person who is in the Forex trade. Being a trader has its merits: no fixed office hours, no superiors, no business rivals, and no limits in earnings. Trading is an interesting, creative, work where anyone can be his/her own master.
Being a foreign exchange market, it is easier to explain the Forex principles by comparing them with those of an exchange office.
What Forex and the exchange office have in common:
How Forex and the exchange office differ:
How to start trading
Account opening with the Forexite company is as follows: go to https://www.forexite.com/traderoom/ and click the "Real account" of the "Account Registration" menu. Then fill in the form, confirm your acceptance of the agreement, and choose your username and password. The account will be opened upon data verification, which you will be notified of by e-mail.
Through a bank you can fund your Forexite account with a deposit in US dollars (USD), Euros (EUR), rubles (RUB), and other currencies (please see the complete list in the trading conditions). Via WebMoney you can transfer US dollars (WMZ), Euros (WME), rubles (WMR), and Ukrainian hryvnas (WMU) to your Forexite account. The Forexite minimum deposit is more or less unrestricted, so you can even fund your account with 1 USD or the equivalent in another currency. The transfer procedure is described in "Funds Transfer" of the "Trading with Forexite" section in more detail. Let's assume a trader has added to his/her trading account 2000 USD.
Let's take as an example the most popular instrument of EUR/USD (a EUR to USD rate) and Euro buying for USD. Suppose the Forex EUR/USD rate is 1.2500/1.2505. It means the trader gets 1.2500 USD for 1 EUR, and pays 1.2505 USD to buy 1 EUR. With the deposit equal to 2000 USD and a leverage of 100, you can execute a trade for an amount up to 200 000 USD. However, you are recommended not to use the whole leverage so as to limit the risk. Assume the trader has bought 20 000 EUR for USD. At the specified rate he/she has paid 25 010 USD for the 20 000 EUR (it is calculated as 20 000 * 1.2505). By buying the trader has thus opened a position.
Assume that during the day the rate has advanced from 1.2500/1.2505 to 1.2600/1.2605, and the trader has made up his/her mind to close the position with the opposite trade selling the 20 000 EUR for USD. He/she gets for this amount 25 200 USD (it is calculated as 20 000 * 1.2600). The result is that the trader profits 190 USD (the sum is computed as 25 200 - 25 010, or as 20 000 * (1.2600 - 1.2505)). Thus, the profit made from the two trades in the example comes to 9.5% of the deposit placed.
You can transfer from your Forexite account to a bank in US dollars (USD), Euros (EUR), rubles (RUB), and other currencies (the complete list is in the trading conditions). Via WebMoney you can transfer from your Forexite account US dollars (WMZ), Euros (WME), rubles (WMR), and Ukrainian hryvnas (WMU) to your banking account. You can even withdraw your funds from your Forexite account when you have your positions open, if not all the funds are involved in the trading. To withdraw, you have to place an outgoing order in the TradeRoom system, and the funds will then be transferred to the account you have specified.
How to learn earning through Forex
The above Forex operations are practically as simple as that. And the aim of the operations is also clear: buy cheap, sell at or better. However, a trader's main task, which is the right trading decision-making, is not as simple and requires some certain knowledge.
There are different methods of market and decision-making analyses but all of them are based mainly on two approaches. The fundamental analysis means analyzing the economic and political state of countries to forecast whether a currency will go up or down in value. The technical one represents an analysis of currencies through movement graphs and relies on an assumption that a future currency trend can be predicted from its previous movements.
The issue of how to learn earning through Forex is not within the scope of this article. There are many books about it that we would recommend you to begin with. You are also advised to study the "For Beginners about Forex" articles in the Forexite web-site: "What a Trader is", "Trading Basics", "Why Currency Rates Move", "Market Analysis Methods", "Recommendations to Traders", "Safe Forex".
You are recommended to open a virtual account, or a real one with a small amount, to put your knowledge to use. During training and studying theory you will choose the way you would prefer to trade in, or develop your own one. Training may take you a few months, or a few years.
Anyone may become a Forex trader, but one has to work hard to succeed in trading as in any other business. Trading through Forex requires attention, self-control, and an ability to analyze a situation and make a decision fast. It gives freedom and potentially unlimited income in return.
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