Posted on 13 March 2012.
Learning Forex trading for dummies is a great way to get involved in the foreign exchange (forex) market. Even people who have been investing their whole life can find the forex market a little perplexing. The best way to approach this financial market is with a trip through the basics.
The forex market allows people to invest in currencies. It may seem odd to some people that traders invest in money. After all, money is what you use to invest in something else. However, the constant fluctuation of currencies when their values are compared to one another makes it possible to treat money itself as an investment. There are also a lot of potential profits to be made from lightning trades which take advantage of sudden changes in value.
In some ways, the forex market resembles other financial markets. However, there is some new vocabulary to learn as well as some altered parameters. You should not let all this learning deter you from learning forex trading for dummies. The forex market is the largest market of them all, moving trillions of dollars more in transactions than the stock markets every year.
Extended hours are the first thing for which you must prepare as part of your forex trading for dummies training. While the stock markets keep very tame hours and usually end in the mid-afternoon of whatever country in which they are situated, forex markets are open around the clock. They do not close until 10 PM Greenwich time and reopen at 8:15 Sunday night.
Forex trading for dummies also includes learning some new words. For instance, pip is the word used to describe the lowest exchange value used in trading currency. All currency prices are quoted to four decimal places. For instance the difference in value between USD 1.0121 and USD 1.0122 is exactly one pip. This is one critical piece of learning in forex trading for dummies.
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