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How does Forex (foreign exchange) work?

Just as a general thing what does one do to make money with forex? Is it like stocks, or does one need a program to be able to play it? Where does one play forex, through a bank brokerage like stocks

Public Response to How does Forex (foreign exchange) work?

  1. Let us say that your home currency is USD and you believe could make profit with the fluctuations of another currency, let us say British Pound (GBP). We need two currencies as the each fluctuations could be assessed by another one. When GBP demand (and so do price) soars high compared to USD you are making profit. It means you sell GBP for a larger amount of USD. If GBP trades lower than USD you are making losses. The fluctuations depend on many variables such as the amount of import and export for the country, the government extent to control the value of the currency (dirty float), demand of the currency etc. Just like stock you need to open an account at any forex brokerage firm. A program to be able to play it? No, your broker needs the program but not you. You are recommended to get a chart package to simulate the current pricing and to make some technical analysis.
  2. The Foreign Exchange market, also referred to as the "FOREX" is the biggest and largest financial market in the world. It has a daily average turnover of US$1.9 trillion- just imagine that amount of money! Don't you want to join this trillion-dollar industry? FOREX is the simultaneous buying of one currency and selling of another. Currencies are traded in pairs, for example Euro/US Dollar (EUR/USD) or US Dollar/Japanese Yen (USD/JPY). So basically, FOREX is trading. please visit the site for more information... www.forex.com http://www.bestfxtradingtips.com
  3. The foreign exchange market (currency, forex, or FX) is where currency trading takes place. It is where banks and other official institutions facilitate the buying and selling of foreign currencies (http://fap-turbo.echoz.com/). The foreign exchange market is unique because of - its trading volumes, - the extreme liquidity of the market, - its geographical dispersion, - its long trading hours: 24 hours a day except on weekends - the variety of factors that affect exchange rates. - the use of leverage Making money by selling currency may lead to some sleepless nights because this market never sleeps, but thanks to http://fap-turbo.echoz.com/, its finally brought so close to all of us. All you need is to install it once and have your computer open and running - it runs 24/5, calculates, opens and closes trade for you automatically. A really interesting concept, and a tremendous earnings potential, especially at a time when not many of us made anything above 0 in the stock market!!
  4. Hi, As a college student I was struggling to find some ways to make some spare cash, knowing I didn’t have much to invest initially. I came to find Foreign Exchange trading, ie Forex. It seemed to be a very profitable investment mechanism. After reading a lot of reviews of things I didn’t really believe, I stumbled upon some of the robots I thought looked more promising. I realized I would be at a huge disadvantage playing the market just by instinct rather than real calculations that others were using. The one I found that looked the most reliable was http://www.forexmegadroidsoftware.com Reasons I chose it: Developers had over 35 years of trading experience Ability to adapt to any market condition -This seemed to be the real unique feature Claims of over 300% gains a month After reviewing as many systems as I could find, I purchased this one. I only had a $1000 to invest, but tried it anyway. I honestly didn’t make a 300% gain, but I did increase my $1000 to ~$2300 in just under a month. I’d say that’s pretty good. Maybe larger investments could have greater gains, I don’t really know. I did have a few days with losses, but none were more than $55. Just my honest review here, hope it helps you in your decisions.
  5. Being the main force driving the global economic market, currency is no doubt an essential element for a country. However, in order for all the countries with different currencies to trade with one another, a system of exchange rate between their currencies is needed; this system, is formally known as foreign exchange or currency exchange. In the early days, the system of currency exchange is supported solely by the gold amount held in the vault of a country. However, this system is no longer appropriate now due to inflation and hence, the value of one's currency nowadays is determined through the market forces alone. In order to determine the value of a currency's exchange rate, two main types of system is used which is floating currency and pegged currency. For floating exchange rate, its value is determined by the supply and demand of the global market where the supply and demand is bound by all these factors such as foreign investment, inflation and ratios of import and export. Normally, this system is adopted by most of the advance countries like for example UK, US and Canada. All of these countries have a similarity where their market is well developed and stable in economic terms. These countries choose to practice this system due to the reason where floating exchange rate is proven to be much more efficient compared to the pegged exchange rate. The reason behind this is because for floating exchange rate, the market itself will re-adjust the exchange rate real-time in order to portray the actual inflation and other economic forces. However, every system has its own flaw and so does the floating exchange rate system. For instance, if a country suffers from economic instability due to various reasons such as political issues, a floating exchange rate system will certainly discourage investment due to the high risk of suffering from inflationary disaster or sudden slump in exchange rate. Another form of exchange rate is known as pegged exchange rate. This is a system where the value of the exchange rate is fixed by the government of a country and not the supply and demand of the market. This system is called pegged exchange rate because the value of a country's currency is fixed to another country's currency. As a result, the value of the pegged currency will not fluctuate unlike the floating currency. The working principle behind this system is slightly complicated where the government of a country will fixed the exchange rate of their currency and when there is a demand for a certain currency resulting a rise in the exchange rate, the government will have to release enough of that currency into the market in order to meet that demand. However, there is a fatal flaw in this system where if the pegged exchange rate is not controlled properly, panics may arise within the country and as a result of that, people will be rushing to exchange their money into a more stable currency. When that happens, the sudden overflow of that country's currency into the market will decrease the value of their exchange rate and in the end, their currency will be worthless. Due to this reason, only those under-developed or developing countries will practice this method as a form to control the inflation rate. However, the truth is, most of the countries do not fully practice the floating exchange rate or the pegged exchange rate method in reality. Instead, they use a hybrid system known as floating peg. Floating peg is the combination of the two main systems where one country will normally fixed their exchange rate to the US Dollars and after that, they will constantly review their peg rate in order to stay in line with the actual market value. The Foreign exchange market, or commonly known as FOREX, is the largest and most prolific financial market because each day, more than 1 trillion worth of currency exchange takes place between investors, speculators and countries. From this, we can deduce that the actual mechanism behind the world of foreign exchange is far more complicated than what we may already know, and that, the information mentioned earlier is just the tip of an iceberg.
  6. The Forex Trading Market has a daily turnover of about 3 trillion dollars ($3,000,000,000,000), thus making it the biggest market in the world. Forex traders trade exclusively "Over the Counter" (OTC), meaning that all deals take place between the buyer and the seller, with no stock-market mediation. This unique aspect allows the private traders, with or without experience, to trade in a market in which companies and corporations actively participate as well. This market's great liquidity allows the trader to withdraw his funds at anytime. Furthermore, the continuity of trade within the Forex Market, allows traders to trade anywhere at any time. Although the movements within this market are small, by leveraging his/her funds, the trader can make a substantial profit with only a relatively small investment.
  7. forex is trading, and they are traded in PIPS, which are like thousandth of a cent. they work on the principle of leaverage, that is , you can move 1000$ by having 1$ in your account. so you have to be very careful in these things, money in forex is NOT made by profiting in every trade, it is made by limiting losses in trades. since you will be practically making money in almost all the trades, that's why there are hundreds of automated trading systems which actually make money simply by technical analysis, the biggest advantage of this system is that it does not involve " emotions in trades" so software can take hard decisions right now FAP turbo and news trader are going on very well. adn actually making money.
  8. AIG was be a best stock to invest if you plan to invest for a long term, because AIG is too big to fail and beside AIG no longer need government bailout money. if you invest in AIG are now you returning profit is 10-30 times in 3-5 years.