Forex FAQs
What is Forex?
Forex is short for the foreign exchange market. It is also known as FX or currency market and is a global market that involves the trade of currency pairs, for example Pounds Sterling and US Dollars. It is open for 24 hours a day.
Why do People Trade Forex?
Some businesses may use Forex to pay for goods and services in other countries. Other companies or individuals may trade Forex with a view to profiting from fluctuations in exchange rates; they aim to buy currency when its value is low and sell it when its value is high.
What do You Need to Trade Forex?
To start trading Forex, an individual needs an account with a Forex brokerage, a deposit (the amount depends on the broker, but is typically between $2,000-10,000), a computer and high-speed internet access.
What are the Different Methods of Trading?
There are three methods of trading. Day trading involves buying and selling currency within one day, swing trading takes place over a few hours to a couple of weeks and position trading is much longer term, over a few months or years. Traders should choose their method according to their individual preferences; day trading is ideal for those who can spend a long time in front of their computers, swing trading is ideal for beginners or those with less time and position trading is ideal for those looking for a long-term investment and who can hold their nerve even if their currency falls in value for a time.
