Best Forex Investing Tips

What is Forex investing, you ask? From a beginners standpoint let’s take a look at the currency trading market and its basic definition…

Forex stands for foreign exchange. It’s also referred to as FX. In Forex trading, one currency is purchased while another is sold.  Basically, you’re exchanging the sold currency for the one being purchased, hopefully for a tidy profit. Forex is an over-the-counter market, meaning anybody and everybody has access to it. This hasn’t always been the case. Initially, only big institutions like banks and investing firms had access to trade the FX markets.

Currencies trade in pairs, like the Euro/US Dollar (EUR/USD) or US Dollar/Japanese Yen (USD/JPY). Unlike stocks or futures, there is no centralized exchange for forex. All transactions happen over the phone or through an electronic network

So, who trades currencies, and why?
Well, daily turnover in the world’s currencies comes from two sources:

1 – Foreign trade (5%). Companies buy and sell products in foreign countries, then
convert profits from foreign sales into domestic currency

2 – Speculation for profit (95%). A Forex trader would be considered a speculator or prospector

Most trades focus on the biggest, most liquid currency pairs, including but not limited to: US Dollar, Japanese Yen, Euro, British Pound, Swiss Franc, Canadian Dollar and Australian Dollar.  In all actuality, more than 85% of daily forex trading happens between the major currency pairs

Forex is the most traded market in the world, a true 24-hour market running from Sunday 5 PM ET to Friday 5 PM ET. Forex trading begins in Sydney Australia, and moves around the globe; First to Tokyo Japan, then London England, and then finally to New York City.

So, if you’re looking for a 24/7 way to supplement your income, or make a decent living even, then Forex investing may be just the tool for you.