What is Forex?

What is Forex?

On Forex

Forex is a term used to describe the global currency market and could also be referred to as FIX.

It is through this market are all Currency converter Global trading.

The establishment of this market in 1971 when the global markets have moved from fixed price to variable exchange rates. As a result, the size of the market and of immense liquidity, Forex market has become the largest and most important financial markets in the world.

Here are some key features that are the source of the success of this market:

Forex market is available 24 hours a day 0.5 days a week

Trading and high liquidity in the market provides ease of trading most currencies

You can make a profit from rising prices and falling at the same time

You can take advantage of doubling earnings by using the leverage that can be used simple requirements

The presence of special tools that will help you and let you select your own risk

Foreign currency market is a transparent and clear market, all you have to do is follow the news and information on the market

exchange rate

Forex market plays an indispensable role to determine prices and the global exchange. The exchange rate is the number of units of the country's currency that must be exchanged in order to obtain one unit of the currency of another country. Market exchange rate between two currencies determined by the official and private interaction between participants in foreign exchange in the market prices.

Market participants

The main participants in the foreign exchange market were: central banks, commercial banks, financial institutions, reserve funds, commercial companies and retail investors. The main reasons for share them in the foreign exchange market are:

Earn a profit from fluctuations in currencies (speculative)

Protection of currency fluctuation, which is derived from the trading of goods and services (fencing)

With technological development, the net global network and an easy way to become a trading, as can be made available to individual investors and traders access to all the news of the forex market, technology, and tools.

Members of the currency market

Currency Market

Currency market is an international organization of trade openly, that market is a central, self-regulation works in accordance with the absence of any central exchange or any entity controlling, unlike the stock markets and futures markets. These structural cancel fees imposed on exchanges and brokerage and thus lead to lower transaction costs.

Forex Trading market featuring many Hamstring- with different needs and Madrassah- who trade with each other. Participants can be divided into two groups: trading between banks and retail markets, trading markets.

Trading market between banks

Currency trading inter bank market includes transactions between central banks, commercial banks and financial institutions.

Central banks - the national central banks (such as the US Federal Reserve and the European Central Bank) as they play a very important role in the currency market. Major monetary authority, where its role is to achieve price stability and economic growth. But they can do that, they regulate the entire money supply in the economy by setting interest rates and reserve requirements. As it manages the country's foreign exchange reserves that can be used to influence market conditions and exchange rates.

Commercial banks - (such as Deutsche Bank and Barclay Bank) where they provide liquidity to the foreign exchange market, as a result of the large volume of trading each day. It is this trade such as foreign currency conversions on behalf of customers' needs, while some of them carried out by the trading rooms in the same banks.

Financial institutions - financial institutions such as money managers, investment funds, pension funds and brokerage firms that trade in foreign currency trading as part of its obligations and to seek the best investment opportunities for their clients. For example, it will be the portfolio managers engage in Forex trading for the buying and selling of global equities.

Retail Market

The retail market with overseeing the dealings between investors and speculators and investors in the young market. These transactions are executed through brokerage firms that act as an intermediary between the retail market and the inter bank market. It is involved in the retail market are hedge funds, corporations and individuals.

Reserve funds - the reserve funds and private investments and that the expectations of various trading and financial categories using cranes. The reserve funds and seize the opportunities to trade in the currency market. Start the implementation of their operations after the sale or purchase of macroeconomic analysis, which reviews the challenges affecting the state and its currency. Because of the large amounts of liquidity, strong and aggressive strategies, such funds shall be considered as one of the most important dynamics of the major shareholders in the currency market.

-the Represents companies engaged in import and export companies, where these activities are done with their foreign counterparts. And their core business is the sale and purchase of foreign currency requirements for goods and exposed to currency risk. Through the currency market to convert their currencies to protect themselves from fluctuations in the future.

Individuals - individual traders or independent investors in the currency markets who rely on their own capital in order to benefit from speculation on exchange rates in the future, where they work through the currency markets trading platforms which gives teams a simple points between supply and demand price and the immediate implementation of operations in addition to accounts high margin.

The stock exchange trading via the Internet

The stock exchange trading via the Internet

The massive development of communication technology and programming a key

role in Internet development and spread around the world. This has had a major role in bringing about a radical change in many of the economic, cultural and even political matters. The Internet is now the
"network of networks"

linking all people of differing cultural backgrounds of their countries and gain a human can not do without it, but increasingly relied upon days behind Day.

And trading in international stock exchanges from more economic fields has become exploited the Internet to spread.

Where anyone can buy and sell any kind of goods from anywhere in the world and in any exchange pleases. All that one needs is a computer and Internet connection .. !! Whether you want to trade stocks or commodities or currencies, The Internet has become the main venue and safe to do so. How stock markets are trading via the Internet?

Which was the item that you want to trade in the type you can not do it only by the company will be the mediator between you and the stock market which trades in which, one can not generally go to the Stock Exchange immediately and proceed with the sale and purchase directly, but this is done by private and licensed and with companies highly experienced called brokerage firms Brokerage firms .and this will implement the buy and sell orders which are ordered and many other services to you.

And the process is done basically as follows:

• choose the brokerage company that you want to deal with it.

• open an account in your name to it, and deposited the amount you wish invested.

• The follow-up of the stock market that would like to trade them and ordered the brokerage firm to sell or buy the item you want and at the price you choose.

• brokerage firm will through their representatives who are more or less in the stock market the implementation of orders.

• profits will be added to your account or deduct losses from trading from your account at the brokerage firms.

• You can of course withdraw the amount deposited in the brokerage firm or add attic any time you wish.

In the past, dealing between you and the brokerage firm is by dial-up or using the fax, when decide to buy shares of a company, for example, you are connecting up with the brokerage company and ask them to carry out the purchase of the required quantity of the shares of this company at the price determined.

Now, as a result of the evolution of the Internet bringing the deal between you and the brokerage firm is by special software platform underlying be obtained from the brokerage firm and you download (download) on your computer probably - there are some sites that use trading on the Internet browser platform directly In with technology JavaScript ( Java).

When you open an account with Forex company that you have chosen the company will ask you that you download its software on your computer and give you a word of your own password you will use to connect to the brokerage firm and secure passage.

This program will provide you with a direct and immediate connection between your computer and which will be connected to the Internet and the brokerage firm where you can determine which of the sale and purchase and look at your account and previous operations that you have made orders etc ..

These programs are characterized by extreme ease and clarity and are not in need of expertise, especially in the computer or the Internet to deal with it is mainly designed to use the average person with limited experience in the computer, and you'll always find complete instructions on how to use these programs from the brokerage firm you are dealing with. And we'll talk about it later.

We have provided these capabilities, which were in dreams counter a few years ago as an opportunity for many people to deal with the brokerage firms may be on the other side of the world without the need to comply with companies in the country as was the case in the past, giving greater room for choice and sparked competition among companies mediation to provide better services and to reduce the costs that are required of the stores to pay for these services.

And now ..

After becoming familiar with a lot of information on the stock markets in general trading mechanism and the principles of margin trading system. We can now move to the second part and the main of this book a competent part to trade currencies on a margin, which will be after you read and understand what it is eligible to start in practice going into this exciting world.