Wealth Building in the Forex or Foreign Exchange Market. - Finance

Wealth Building in the Forex or Foreign Exchange Market.

If you look closely at the term 'forex' you will see it comprise of two abbreviated words,

'foreign' and 'exchange'. It describes a market system under which one country's currency is

exchanged in trade for another country's currency. For example the $USD may be traded for the

GBP meaning that you would buy up quantities of US dollars with the stronger UK Sterling as

at present time. You buy in anticipation of your US dollar holding rising in value in the

near future so as to turn a profit for you when you sell your dollars. In this scenario you

are effectively trading in the foreign currency market.

The Forex market is open to trade by private individuals through the medium of a broker. It is

the largest financial market in the world, much larger than the stock market, and trades over

$US 3 Trillion globally on a daily basis. Except for weekends the Forex market trades every

day 24/7 due to differences in the time zones for different countries where as one market

close another opens in another country.

The major players in the Forex market starting with the top tier down are banks, commercial

companies, central banks, hedge funds, investment management firms, retail forex brokers and

non-bank foreign exchange companies known as foreign exchange brokers.

There is no central market clearing system but rather a number of inter-connected markets due

to the nature of the over-the-counter (OTC) transactions. The main trading centres are London,

New York and Tokyo, Hong-Kong and Singapore. Each trading currency is denoted by three

letters, for example the US dollar is denoted by USD, the British Sterling GBP, the Japanese

Yen is JPY etc. This makes for certainty as to which currency you are dealing with.

When currencies are traded this must be done in pairs only which are referred to as products.

So, for instance if the British Pound Sterling is being traded against the US dollar this

would be expressed as GBP/USD where the GBP is referred to as the base currency meaning it is

the stronger of the two currencies. The weaker currency is known as the counter currency.

In order to conduct any type of legitimate trade in the foreign currency market as an

individual you must go through a foreign exchange broker described above. For effective

trading you will need to be aware of factors affecting currency trading. These elements are

outside the scope of this article but they include economic and political factors and market

psychology. In turn these factors influence the supply and demand for individual countries

currencies.

The foreign currency market cannot therefore be influenced by 'insider trading' as is the case

with the stock market. The foreign currency market is therefore one of the best barometer of

the state of individual countries. An individual therefore has as much chance as the banks for

making profits (or losses) in the Forex market. The only advantage the banks have for making

money in the foreign currency market over an individual apart from relative volumes of cash,

is access to their clients 'order flow' or buying trends.

The foreign currency market can become a wealth builder for the individual. The Forex market

is growing exponentially building wealth for the banks, governments and large institutions.

There are more opportunities now for individuals to trade and become a part of this wealth

producing force due to the explosion of the internet. There are many games and software

simulations online that an individual has now has access to which increases his education and

skill levels in dealing in foreign currency trading. Below I recommend a proprietary piece of

software to help you with trading in the foreign currency market.

To get started in learning about forex trading, you will need to locate the forex trading

software, education-learning system you want to use. There are many on the market you can

choose from if you wish but the software below comes with mine and many other users

recommendation. You can see the numerous testimonials on the site prior to downloading the

software. As you find the games, as they are called, you will enter information about

yourself, about what you are interested in learning and then you will download software to

your computer. In following the 'game', you will learn how to make profits or what it is like

to lose money in the forex market. This type of game is going to make you more aware of what

happens on a daily basis, how the markets open and close, and how different the various

countries currencies really are.

You will open an online 'account' using the gaming system. You will then be able to read the

news, find and compare markets, and you will be able to make 'fake' trades so you can watch

your money build or be eaten away in losses. As you learn the system, using it a few times a

week, you are going to be more prepared, more educated and you will be ready to use the forex

trades for real to make money. Of course, you may still need the aid of broker or a company to

make your transactions happen but you will better understand the process, what will happen,

and what calls you may want to make when you read about the news, the markets, and the

currencies in other countries.

To get started today simply scroll down to the link below in my BIO and click on it. You will

then be re-directed to our web-page where you download our proprietary market software. This

is an easy to use software with voice-over instructions and also an e-book to get you started.

Good luck with your investing on the foreign currency market.

The Author

Matrix Jones