What is Forex?
Forex is short for foreign exchange. Foreign exchange relates to currencies across the world and their rates and pricing relationships between each other. Forex can be traded and is used for many different reasons, from business, to speculation and more.
How do you make money with Forex?
Money is made in Forex when the currency you invest in goes up or down, against another currency. Currencies are traded in pairs, one against the other. One price is formed between the two. For example, One Aussie dollar might buy $0.70 US Dollar. The price would show as 0.70000 if this was the case.
If the AUDUSD goes down, and you have shorted the market (sold it) your intention was for the market to go down and you have made a profit. If the market went up though, you would lose money if you were short (sold the market). The opposite is true for buy orders, also known as going long.
Who trades Forex?
FX trading isn’t limited to speculators. Countries (governments), companies and individuals all trade Forex (FX) for many reasons. These reasons can be to pay bills in another currency, to travel to, or live in another country, or to invest in another country’s assets. There are also speculators, who can trade using a broker to buy or sell based on analysis in the hope of earning a profit.
Want to trade?
Check out what we have to offer in terms of training, education and more! We can even help you find a reputable broker.
0 Comments