For any investors who think that the investment market is easy, this may later cause regrets and frustration on their end. Trading, regardless of what commodity you are interested in the investment is hard and a bit technical. However, this doesn’t mean that you can’t succeed in it. By arming yourself with the right knowledge and practice at the same time, you will eventually reach success.
So what basically is currency trading and how would you know if this is suiting for your needs?
FOREX (FX) or also known as the currency market is the biggest investment market you can ever find. Every year, it just keeps on growing. In fact, on April of 2010, the market has reached 4 trillion dollars turnover as being its daily average. Generally, it is a 20 percent increase since 2007. When compared to the NYSE or the New York Stock Exchange, there’s just a 25 billion dollars of daily volume.
Currency trading is open 24/7 and it’s closed from Friday to Sunday evening. This makes the 24/7 trading session to be somehow misleading. In fact, there are 3 sessions that a trader may join in and these are:
- Asia
- Europe and;
- America
Despite the fact that there’s overlapping in sessions, the primary currencies in every market are mostly traded during market hours. In other words, some currency pairs have bigger volume on a given session. Traders who opt to stay with pairs based on dollar find most volume in US trading sessions.
Pips and Pairs
Every currency trade you see in the market is traded in pairs. Compared to the stock market in which you could either sell or buy a single stock, you should buy one currency and then sell another currency in FOREX. Also, almost all currencies are priced to its 4th decimal point. A pip or the percentage in point is basically the smallest increment of a trade wherein 1 pip is usually equivalent to 1/100 of 1 percent.
Beginning or retail traders normally trade currency in form of micro lots. This is because a pip in micro lot is representing just 10-cent movement in price. With this, it allows them to easily manage if their trade does not produce the expected results.
Road to Financial Independence
If you’d be able to master or at least get the concept behind money trading, then this can help a lot in growing your finances and make it easier for you to get approval from 24 hour car title loan companies.