So what is is Forex trading you
may ask? Forex is the exchange you
can buy and sell currencies. For example, you might buy British pounds (by
exchanging them to the dollars you had), then, after pounds / dollar ratio goes
up, you sell pounds and buy dollars again. At the end of this operation you are
going to have more dollars, then you had at the beginning.
The Forex market has much higher
liquidity, then the stock market, as much more money is being exchanged.
Forex is spread between banks all
over the planet and as a result it means 24 hour trading.
Unlike stocks, Forex trades are
performed with high leverage, usually it is 100. It means that by investing
$1000 you can control $100,000, and increase potential profits accordingly. Some
brokers provide also so called mini-Forex,
where the size of minimum deposit equals $100. It makes possible for individuals
to enter this market easily.
