What is Foreign Exchange Currency Trading?
The most basic definition of Foreign Exchange Currency Trading is the trading of a pair of distinct currencies from different countries against each other. The aim of Foreign Exchange (Forex) Currency Trading is for traders to make a profit based on the difference or changes in value between the currencies.
Who governs Foreign Exchange Trading?
While there is no single entity that is tasked with governing the worldwide Forex market, there are a number or regional and national organizations that provide general oversight in aspects Foreign Exchange Trading. In the US, both the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) ensure that traders and investors stay informed on happenings in the market, while preventing fraud.
Who participates in exchanging the currencies? Who are the traders?
The main participants in currency exchange transactions are the traders and brokers. A trader is someone who, after learning forex trends, uses their knowledge of forex strategy to buy certain currencies when they have a low value with the aim of selling them when their value improves, thus making a profit. The trading is facilitated on behalf of the traders by agent companies known as brokerages.
How is Foreign Currency Trading different to trading on the Stock Market?
Although Foreign Currency Trading may appear similar in some ways to people learning forex, there are two important and fundamental differences. The first is that the trading of Forex is not related in any way to the profits or losses of any corporations, only with the relative values of currencies. The second is that, unlike the stock market that deals with local business conditions, the trading of foreign currencies is related to international finance.
What is Foreign Exchange Autotrading?
Foreign Exchange Autotrading is a forex strategy used by some traders who issue buy and sell orders automatically and at a high rate through forex trading software. The trader's orders are triggered by the program or system when a set of predetermined criteria are met.
Explain Foreign Exchange spot transactions.
A foreign exchange spot transaction involves the exchange of one currency against another at a pre-arranged price and delivered on a value date that is normally the date of trade plus two working days -- the 'spot value.' The spot transactions market is the largest among all forex markets, accounting for approximately 30% of dealing volumes.
What are Foreign Exchange signals? How are they used in trading?
The term Foreign Exchange Signal often refers to a forex strategy suggestion made to a trader to enter into an exchange of a currency pair at a specific time and price. Signals may be automatically generated by Forex robots or a human analyst and may be communicated via SMS, email, RSS or on a website.
What do I need to start trading online? Do I have to have a broker?
The beauty of our program is that you don't need to become a Forex expert before you begin. You'll need the money that you want to get started with and an online brokerage account to facilitate trading. We have done the 'heavy lifting' for you so one you have your account, we send you signals through our researched, time tested program.
If you want to grow your knowledge base and develop your own Forex trading strategies, you need to be enthusiastic and prepared to study the foreign currency markets, then develop and test your own algorithms and strategies. There are numerous software packages available online to speed this process along, but please proceed with caution and do plenty of homework on those software packages. Check out their support and read their reviews. Many are out of business soon after releasing their programs. They make their money on the software subscription and are not concerned with your success.
Our program is different. There is no Forex trading software to configure or program to learn. We make our money when you are successful.
It is important to note that foreign currency is by nature volatile and has inherent risk. The goal should be steady, long term positive results, but that does come with fluctuation and you should never risk capital that is essential to your household income. If you are developing your own Forex strategy be you have sufficient starting capital to cover inevitable losses incurred when traders who are learning forex start out.
What licenses do Forex signal providers need? How do I avoid scams?
A Forex signal provider is required to register as a commodity trading adviser with the Commodity Futures Trading Commission (CFTC). However, this requirement is waived in cases where non-personalized forex strategy signals are sent to all clients through forex trading software or a website.