Fx Trading Jobs London
Whether you are a stock broker or just the average Joe, FOREX trading should be considered to be part of one's investment portfolio. FOREX trading can be very volatile and risky. This is only because the FOREX is complicated and most don't understand how it works before they get involved. The reality is that the FOREX can make thousands of dollars per month for someone who wants to take the time to learn. Fx Trading Jobs London
What FOREX really means is FOReign EXchange market. It is the trading of international currencies, 24 hours a day. The trading doesn't occur in a centralized exchange like the NYSE but from registered dealers who quote on major currencies. An example of a trade would be if you bought $10,000 Canadian dollars at the CDN/USD exchange of 1.18 ($11,800). Then a few weeks later, the exchange changes to 1.25 and you sell your $10,000 CDN back to USD ($12,500) and your profit is $700.
The FOREX is the largest and the most liquid financial market in the world. It includes large banks, central banks, speculators, corporations, governments and other financial institutions. Not so long ago, FOREX trading was limited to businesses, but the rules have changed and now the average "Joe" can trade currencies. Since it open to the typical person, the FOREX has grown to over $4 trillion daily globally. London, England is the busiest, next to New York and Tokyo. There are also FOREX futures, but that is another topic to discuss.
The major currencies that are traded are the USD/CHF - US vs Swiss Franc, USD/JPY - US vs. Yen, EUR/USD - Euro vs. US, GBP/USD - Great Britain Pound vs. US, USD/CAD - US vs. Canadian Dollar and lastly AUD/US - Australian vs. US. There are many more, but these represent the 6 biggest currencies traded. These were decided in 1972 and have basically stayed the same since. Fx Trading Jobs London
The concept of Currency Pair Relationship is the basic idea behind FOREX. It involves two currency, the Base currency and the Cross currency. When we describe the currencies early as USD/CHF, the US dollar is the base currency and the Swiss Franc would be the Cross Currency. The direction that the Base Currency is moving (up or down) correlates precisely with the direction of the currency pair. If the base currency loses value and the cross currency gains value, then the resultant currency pair price will go down. So it is critical to watch what base currency you select. You would have also noticed that the USD is not the base currency all the time. This was decided because of the influence one country can have over another when it comes to currency.
The three elements you should become familiar with are LOT, LEVERAGE and PIP. A lot is what you buy or sell. Think of it like shares. It is the "stuff" you deal with. Leverage determines the cost of a lot. The higher the leverage, the less a Lot costs. The will be described as 100:1 lot costs $100 or 200:1 lot costs $50.The most important element is PIP. A PIP, or Price Interest Point, is the value of each price movement. Because we are dealing with two currencies, a PIP tries to create a unit of measure that you can use to determine where you stand in the trade. More PIPs gained means that you are more profitable with the trade.
There are many variables that cause the currencies to rise and fall. Knowing what these factors are can really help in becoming a successful FOREX trader. Pay attention to when reports such as unemployment reports, government policy changes, interest rate changes, and other "country" represented stats are released for both the base currency and the cross currency. These reports are either monthly or quarterly and you will find that they will provide a very predictable trend in the currency value. You only need your base currency to either go up or your cross currency to go down to be profitable.
If you're interested in learning more about FOREX, spend the time to take a course. There are so many options when it comes to trading. You can make money when a dollar goes up or down and make that dollar 24 hours a day. There are also many software programs and online business that will be happy to educate you and help you become successful such as 4X Made Easy, Forex.com and AvaFX.com. Learn as much as you can and during your first few months and expect not to be profitable. The FOREX is very complicated and you can find yourself in a downward spin very fast. You can also come out of that spin very fast too if you buy smart according to world news. Fx Trading Jobs London
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