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Question: What is FOREX?
Answer: FOREX (Foreign Exchange Market) – is a global currency market for exchanging a particular sum of currency of one country into the currency of another country at the exchange rate agreed for a particular date. Question: Where is FOREX located?
Answer: FOREX has no special location. It is a huge network of currency dealers connected with each other by means of telecommunications, which are concentrated in all the world’s leading financial centers and work 24 hours a day as a single smoothly running mechanism. Question: How to make profit on FOREX?
Answer: Let’s imagine, you are a client of our company and have 1000 USD on your account, which allows you to make deals with the market lot of 100 000 USD. Having analyzed the change in the USD/JPY rate using the Moving Average Convergence/DivergenceMACD) method (the fast line crossed the slow line going down), you make a decision to buy 100 000 USD against the Japanese yen at the price of 121.00. Several hours later, during the same day, when the USD/JPY rate have grown by 200 points to become 123.00, you decide to close the position and sell dollars at a price higher than you purchased it, so you’ve made profit. Profit (loss) = [(closing price – open price)*lot volume]/closing price. Profit = [(123.00-121.00)*100000]/123.00=1626.02 USD. We must note that fluctuation of JPY by 200 points per day isn’t something extraordinary. Question: Who are the participants of FOREX?
Answer: The main participants of the currency market are: central and commercial banks, currency exchanges, firms performing foreign-trade operations, investment funds, broker companies and individuals. Question: What profit can Forex give me as an individual investor?
Answer: The trader having a relatively small amount of means can operate with market sums of hundreds of thousands dollars. For example, to execute a deal of $ 100 000 at 1% margin, it is necessary to fund your account with only $ 1000 deposit. Question: What are the most liquid currencies?
Answer: The most liquid currencies are the US dollar – USD, Great Britain pound – GBP, single European currency – EUR, Swiss franc – CHF, and Japanese yen – JPY, which share the main volume of all the operations on the FOREX market. Question: Why is FOREX so popular?
Answer: The popularity of FOREX can be explained by the fact that at the present time this market is characterized by the largest volume of auctions, the lowest cost of deals, and the fastest movement of monetary means. It is the only world’s market that works 24 hours a day. |
