Some may not know what Forex is and have not heard of it before, as it is a world of financial transactions based on the process of buying and selling currencies, and daily trading may reach up to 5 trillion US dollars, and for this specifically it is considered the largest global financial market and there are many people involved in trading and buying and selling its currencies There are so-called currency pairs that are intended to trade one currency using another.
How can you benefit from exchange rate changes?!
Exchange rates are not fixed, they change constantly, and the forex trader always seeks to get the most out of these changes. For example, if you need to travel outside your country, you will need to change your currency. For example, you go to the currency exchange and you will change the amount of $ 500 in exchange for buying the euro and after returning From travel, and you had the same euro coins with you, and you went back to the cashier to convert it into dollars, so you took $505. This means that the exchange rate changed, and thus you would have made profits from your money of $5, but at the present time, you do not need to buy actual currencies because through trading through forex you can invest In many different currencies from your place without going anywhere, even if you will use your mobile phone in that, in addition to taking advantage of the changes that occur in currencies from time to time.
Some people may have a lot of questions about forex trading, so let’s review the most prominent of these questions:
When can you trade forex?!
You can trade through the best trading companies throughout the day, 24 hours a day, on a daily basis, noting that trading is divided into 4 sessions, namely the Tokyo session (Japan), the Sydney session (Australia), the New York session (the United States of America) and the London session (Britain).
How to open your first currency pair trade
If you want to open your first currency deal, you can do so easily by following these steps:
1 – Choose a specific currency pair
For example, suppose that you are trading the euro against the US dollar. If the price of one euro is 1.1200 dollars, with an investment of 100 euros, then you can buy 112 dollars without any leverage.
2 – Determine your deal size
You can open a deal worth 400 times the amount you invested in, thanks to the leverage. For example, if you invested 100 euros, you can buy anything worth 40,000 euros worth of dollars with a leverage of 400: 1.
3 – Select the direction
If you are trading currencies with a company, you can open deals even if you expect that prices will decrease. If you expect, for example, that the price will rise, then choose to buy, then close your deal and collect your profits. If we assume that the price of the euro has risen by 0.01 and you decide to close your deal, this means that The difference is 0.01, and the closing price is 1:1300, and the opening price is 1:1200.
Which currencies can you trade?
There are many currencies that you can deal with and there are more than 80 currency pairs that you can choose from which one you want to trade and there are many types of currencies so let us explain in more detail through the following lines:
1- Cross currencies
Where this term is applied to the currency pairs that do not contain any of the US dollars.
2- Major currencies
The currencies that are traded a lot are called the major currencies, and they account for 85% of the currency exchange market, in addition to that these major currencies must have a US dollar in their pairs.
3 – Remote currencies
The term “outlying currencies” is applied to currency pairs consisting of one side that is a major currency and one side that is a secondary currency of an emerging economy.
The main advantages of forex trading are the form of CFDs
There are many advantages that accrue to the trader from trading foreign currencies, and these advantages can be explained through the following lines:
1 – You can open large deals with a relatively small investment amount.
2 – You can trade whenever you want and wherever you are, using your computer.
3- You can participate in the largest financial market in the world.
4 – You will get many sources of useful information for free that will help you trade correctly.
5- Investing in a variety of currency pairs.
6 – You will benefit from the free training provided to you by an expert and specialist in the world of trading.
Trading Leveraged Funds (Contracts for Difference)
At an earlier time, major investors participated in currency trading, but nowadays, anyone can trade from their place with ease, thanks to contracts for difference, and because of leverage, anyone can trade, that is, not a condition that he is very rich to do so. You can open large deals and relatively small investment amounts, where the investment amount can be 100€ and you open a deal of 40,000€ using the 400:1 leverage.