Trading Currency To Make Money | Binary Options

One of the most popular new investment opportunities to emerge in the past couple years is the foreign exchange market or forex market. Up until just recently it was virtually impossible for the ordinary investor to participate directly in the foreign exchange markets and buy and sell currency for profit. In the past the foreign exchange market has been primarily traded by the ten largest banks in the world. Wealthy investors and companies would have to apply and get permission from bank managers and bank presidents to get a foreign exchange trading account. Then would have to keep hundreds of thousands of dollars in cash with the bank just to keep the account open. Now with the increased transparency of the currency markets and technological advancements in electronic trading, forex brokers have taken over the role of the rich investor and are able to offer individuals the opportunity to trade smaller amounts of currency through them. While this opens up new markets to independent investors, it can also be dangerous to people unfamiliar with trading currency and the relationship you have with your broker. Finding the right forex broker is essential to your success when dealing with this type of investment for several reasons. The most obvious is that your forex broker will provide you with the software to trade on your account. You need to make sure you are very familiar with the trading platform and that it contains all the features you want. Some of the most popular features people look for are: the ability to trade directly from your charts, one click trading and robotic or algorithmic trading. The next likely conflict of interest to take into account is the accuracy and timeliness of your brokers price quotations. Every forex broker will provide somewhat different prices on currency pairs depending on many factors including which major bank they trade with, their trading volume and the speed of their software, among others. An easy gauge to help you is to watch the spreads between the bid and ask prices. The difference between those prices is what you will pay in commissions and it should be clearly stated on their website about what that price range will be. When looking at their real time quotes the price ranges should remain similar to what the broker has stated they would be. Third, unlike trading stocks online where your stock broker matches your buy order with another customers sell order, your forex broker is the direct counter party to your trade. This means that your forex broker may stand to profit should the market move against you. Conversely, if your broker has not properly hedge themselves, they may suffer financial loses should your trade be profitable for you. A lot of countries have guidelines detailing how much money the brokerages must be capitalized with in order to successfully fund customers trades. Look into their financial statements to help determine whether that broker is adequately funded and that they have been able to hedge against losses in the past. After you make sure the broker you are looking at has the right qualifications, also search for that company within forums and social networking sites to find other people who have traded with them in the past and learn more about their experience. If the broker has a forum, search through it and look for unfavorable mentions. If there are no negative postings they might have been removed, so see if any of the forum members have posted on a third party site. Search engines can be a effective tool when looking for a forex broker so use them to find comments, news stories and financial information on your broker.

Frequently Asked Questions

1. QUESTION:
   Can you trade currency online with just your bank account?
   I am interested to find out how to trade currency online. I have noticed that money fluctuates quite frequently and in my slow tip toe into investing I would like to find out how trade currency online for purpose of making a few dollars when a countries finance makes a recovery.
   Recomendations on things to read on the subject would be great as well.

   • ANSWER:
     You can't just use your bank account. You'll need to find a forex broker (just do a google search to find one).

     As for things to read - do a search for 'babypips' - or see my source below. Their website teaches people all about how to trade forex - perfect for you.

     Maybe also read the best book on any kind of financial market trading, called 'Trade Your Way To Financial Freedom', by Van Tharp. Despite it's cheesy title, it is very very good.

2. QUESTION:
   Is it better to trade currencies or invest in stocks?
   With what method do people usually make more money? I never really heard of many people trading currencies. Does that mean it's not that good to do that?

3. QUESTION:
   what is the best way for trading currency?
   I am looking for the best way to trade currency.

   • ANSWER:
     I trade currency (Forex, FX etc). This market is minimally regulated & is significantly larger than the US Stock market. 90% of all the people that try Forex trading lose all their money. Of the winners.... they lose 40% of all their trades.

     Many brokers actually trade against you. They make money when you lose money.

     I love this market.... but.... take six months to a year before you put in 1 cent. Learn the skills you'll need. Practice. Backtest. Start out very small. Don't believe 90% of what you see from the brokers. Always move slowly. Part of the way to win in this market is picking trades carefully. It's always better to not trade than lose money.

     This is 100 times more riskier than stocks.

     Read up on this. After you learn a little more, feel free to email me. DON'T JUMP IN!!!!!!!!

4. QUESTION:
   What is the best site for trading stocks and currency exchange?
   I am completely new to the world of trading stocks or currency, but I want to get started. I see ads for all these different websites (ameritrade, etrade, etc.), and I was wondering, which (if any) would be the best for a beginner? I'm not looking to get rich quick, but I would like to start investing my money for the long term.

   Also, which if any of these sites offers a way to trade currencies? Ideally, I would become a member of the site with the best combination of both of these (trading stocks and currency).

   Thanks

   • ANSWER:
     There is no best on-line company

     Mostly all brokerage firms provide their clients with on-line services, including trading platforms, latest market & financial news and research.

     Customer need to select the site that is best for them. Traders have requirements in a site, while investors have other requirements.

     Although most sites are geared to general securities and commodities, however customers may have special needs for the types of products they trade, and the markets in which they trade.

     It seems that the most popular firms for on-line investing all of which provide excellent platforms and services are; Scottrade; Chas.Schwab; TDAmeritrade; Fidelity; E-Trade and Thinkorswim.

     Based on your question, the last thing you should be looking for is an "on-line" site,
     You should first educate yourself about the securities markets and the products traded on each.
     Get to learn the terminology, the rules and the various strategies.

     visits to some websites like MSN Money and Yahoo Finance. (http://moneycentral.msn.com/home.asp http://finance.yahoo.com/ )
     While at MSN following the strategy lab analysts to get a feel for what the pros are doing and why. This site has some basic information for beginners. If any site offers free information, take it. Other website that can provide instructions and help with procedures and terminology are
     Investopedia - http://www.investopedia.com/ Stock Charts - http://stockcharts.com/
     Other - http://www.investorshub.com/ http://www.1source4stocks.com/

5. QUESTION:
   can i make money off trading currencies?
   Hi, im 14 and i have saved 450. I want to make some money so is it possible to make money off trading currencies and how can i?

This entry was posted in Binary Options 2 and tagged Business, currency market, foreign exchange market, forex broker, forex market, Forex Trading, market info by . Bookmark the permalink.

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