Trading Forex

The Forex Market (short for Foreign Exchange Market) is the largest, most liquid financial market in the world, significantly larger than the stock market, with over Five Trillion dollars exchanged on average every single day in 2017. It is decentralised so there is no main exchange but it is traded in financial centres around the world that act as places to buy and sell. This allows Forex to be traded 24 hours a day and is what sets the global exchange rates depending on the amount of currency that is bought in exchange for another (supply and demand).

If you’ve ever exchanged foreign currency to go on holiday you have done the exact same thing that traders on Forex do every day only Forex traders don’t do it to buy goods abroad they do it because they think the exchange rate is going to move in a particular direction. A number of things that happen in real life affect the value of a currency. Among others these include the economic policies of a country, politics, imports and exports .

The currencies are set in pairs, so for instance if you thought the British pound was going to fall against the Euro, then you would buy the EUR/GBP and if you thought the British pound was going to rise against the Euro then you would sell the EUR/GBP.

There are a lot of courses, videos, books and websites dedicated to trading Forex. A great place to get started is to read the books on the reading list below and sign up for a practice account with Etoro where you can copy other successful traders. People have made and lost fortunes trading Forex so remember that as with any trading you should educate yourself as much as possible and only risk what you can afford to lose.

Extra cash

When you sign up to a Forex account you can get extra cashback by registering through a site such as Cashback Cloud, this will give you a commission on all the trades you carry out, similar to rakeback with poker or cashback on your shopping

Top Tip

The best thing to do when starting out learning to trade Forex is to open a dummy or play money account. This allows you to get to grips with the platform you are using without risking any money at first.

Recommended reading

Forex for Ambitious Beginners by Jelle Peters – Ideal for those getting started in trading Forex

MT4/MT5 High Probability Forex Trading Method – How to use a Forex trading system with a high probability of success

Sites to use

Etoro – A social network built around individuals who trade forex, stocks and other commodities.

Cashback Cloud – Sign up to forex through this site to get cashback on your trades every month.