What is necessary to know about the Forex market?
Forex is the international financial currency exchange market founded in 1976. This name comes from “foreign exchange”. The Forex market is essential for the world economics as well as capital exchange among the countries. Not only private investors participate in Forex trading, but also central banks, large importers and exporters, commercial banks and various funds. But at the same time, Forex is a source of decent income for those who can benefit from the changing values of currencies. And moreover, it doesn’t require any Master’s degree in economics. One of the successful examples of Forex trading is the Larry William’s case (USA) in 1987 with the participation of the Robbins World Cup Traiding Championship: he managed to raise the initial capital of $ 10,000 to $ 1,100,000 for 12 months. Later, in 1997, Larry repeated his success: within the framework of the Robins Championship, his capital increased from $ 500,000 to $ 1 million within one year of trading, having made up 100% of the initial amount. How did he manage to achieve such a success? Williams’ market research approach was mainly based on the fundamental analysis. Forex is … Many call it stock exchange, but this is not exactly true. In comparison with the stock exchange Forex is open 24 hours a day, because the world banks are located in different time zones. In addition, it’s a virtual market, and you can trade from any place in the world – from Moscow, New York or the beach in Bali: the main thing is to have an Internet access. The exchange rate is constantly changing – this is what the Forex market is based on. For example, buying a euro for $ 1.2, and selling it the next for the increased rate of $ 1.3 can bring you a profit of $ 0.1.
Of course, if we talk about such small amounts, the income is low as well, the more deals you close, the higher is the earning. It’s supposed to involve trading up and down- buying cheaper and selling more, or selling the currency at a higher price and buying when the price falls. The exchange rates are influenced by various factors: economic indicators and national banks policy, political changes, emergency cases (natural disasters, accidents at large enterprises, terrorist attacks and even weather conditions), as well as rumors, mood and expectations of market participants. However, despite all this, Forex is relatively stable enabling an experienced trader to benefit from the fall of one currency changing the rate of another.