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Forex Tutorial What is Forex Trading?

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Published By:
AVFX Trading HUB
On Oct 14, 2021
Posted in: Blog

Forex Trading Meaning

Forex is short for FOREIGN EXCHANGE. Basically, forex is buying or selling one currency against its value to another. FX or forex market is a global market place for exchanging national currencies against one another. This is done for various reasons, normally commerce, trading and tourism.

 

Just like stocks, forex traders can speculate on the fluctuating value of currencies between countries and profit. Let’s say you travel overseas, you’ll have to exchange your money for the home currency of your destination, this is done so you can buy, purchase or exchange for goods and services.

These transactions are what we call FOREX. Because of the worldwide reach of trade, the forex market is one of the most liquid asset markets in the world with an average daily trading volume of US$7 trillion. The vast majority of currency conversion is undertaken with the aim of earning a profit.

 

The amount of currency converted everyday can make price movements of some currencies extremely volatile. It is the high volatility that makes forex so attractive to traders, enticing high profits, while also increasing the risk. Unlike shares or commodities, forex trading does not take place on exchanges but directly between two parties in an over the counter (OTC) market.

 

The forex market is run by a global network of banks, spread across four major forex trading centres in different time zones: London, New York, Sydney and Tokyo. Because there is no central location, it can be traded 24 HOURS a day.

How does Forex Work?

a table diaplying major forex currencies and their nicknames

Now that you are up to speed about the forex market and have a little bit of understanding of what really drives it, let’s get into the fun stuff! Let me show you how to open your very own first Forex Trading Account.

How do you Open a Forex Account?

  1. Open an account: Find the right BROKER and enter the broker’s website by searching it on google or you can click this link to review account types available which suit you. These include small-scale accounts with low minimum balances designed for beginners or sophisticated features designed for active traders.
  2. Apply: Complete an application form (Fill in your personal details and contacts, etc)
  3. Instant approval: Upon completion, you will be registered with a username and password that will give you access to your account.
  4. Verification process: Log in to the broker’s client portal and verify your account by submitting your ID/Passport and Proof of Residence documents.
  5. Fund your account: Arrange for transfer of funds from your bank to deposit funds into your account. This may be through credit/debit card or electronic transfer from your bank. You can create an e-wallet with BROKER and fund your account instantly, with the lowest fees. Skrill is accepted by 90% of the brokers and is our number #1 recommended high profile & security e-wallet. View other deposit methods here!!

You’re all set: Once your account is funded, you are now ready to open your first trade. As tempting as that may be, we recommend that you also open a free practise account so that you get accustomed to the trading platform and gain that feel and overall access to the Metatrader 4 (MT4) or Metatrader 5 (MT5) dashboard and all its features.

 

 That is to say, how to open and close a trade, how to set your take profit and stop losses, which lot size to use, which currency to trade, what timeframe to use and so on.

Frequently Asked Questions

Forex is real and not a scam. With the right tutorials, strategy and mentorship one can make unlimited passive income.

Yes you can. However you will need mentorship and time to gain experience and be profitable.

By getting their hands on any beginner-friendly material like baby pips, etc.

AVFX Trading HUB offers free trading materials for beginners, intermediate and advanced traders. Take a look at our forex strategies page.

CEO & Founder of the AVFX Trading HUB Company/Website

Written By: Allen Matshalaga

Allen is a professional forex trader, blogger and an online enthusiast who spends most of his time testing and reviewing legit ways of making money online and is determined to help others succeed.

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