22/12/2016
What is Forex?
Forex, also known as foreign exchange, FX or currency trading, is a decentralized global market where all the world's currencies trade. The forex market is the largest, most liquid market in the world with an average daily trading volume exceeding $5 trillion. There is no central exchange as it trades over the counter. Forex trading allows you to buy and sell currencies, similar to stock trading except you can do it 24 hours a day, five days a week, you have access to margin trading, and you gain exposure to international markets.
WHAT AM I DOING WHEN I TRADE FOREX?
Forex is a commonly used abbreviation for "foreign exchange", and it is typically used to describe trading in the foreign exchange market by investors and speculators.
ELEMENTS OF A FOREX TRADE How Do You Read A Quote?
Because you are always comparing one currency to another, forex is quoted in pairs. This may seem confusing at first, but it is actually pretty straightforward. For example, EUR/USD at 1.4022 shows how much one euro (EUR) is worth in U.S. dollars (USD).
What Is A Lot?
A lot is the smallest trade size available. FXCM accounts have a standard lot size of 1,000 units of currency. Account holders can, however, place trades of different sizes, as long as they are in increments of 1,000 units like 2,000; 3,000; 15,000; 112,000.
What Is A Pip?
A pip is the unit you count profit or loss in. This fourth spot after the decimal point (at one 100th of a cent) is typically what one watches to count "pips." For example, if EUR/USD rises from 1.4022 to 1.4027, EUR/USD has risen 5 pips.
