How exchange currency trading is carried out, theory and practice of trading
Exchange trading of currencies takes place on the foreign exchange market, and the market can be both external and internal.
The most famous trading platform is Forex, where most contracts for the sale and purchase of various currencies are concluded.
The process itself is quite complex and successful trading requires knowing and taking into account many different factors.
This article will discuss how trading works in practice and what are the main components of currency trading.
First of all, you should focus on the basic concepts and fundamentals.
Receiving a profit.
Exchange trading in currencies is based on the fact that you want to make money on the difference in exchange rates. The classic scheme of speculative trading is buying at a low price and selling at a higher price, or opening a sell transaction and closing it with a purchase after the price falls.
Profit is formed by the difference between buying and selling, for example, if you bought euros at a price of 1.2500 dollars, and after some time sold at 1.2600, your profit will be 100 points.
When making money on sell transactions, the currency is first sold, and after the rate decreases, this position is closed by purchasing the same currency unit but at a significantly lower price.
The value of one point directly depends on the volume of the transaction; approximately, when making a transaction of 1 lot (100,000 units of the base currency), one point is equal to 10 dollars.
To increase profits on Forex, leverage is used, that is, if you have $1000 and open a deal only with your own money, a profit of 100 points will be equal to only $10.
In the same case of the year, you use a leverage of 1:100, your profit will also increase 100 times and amount to $1000.
Read more about margin trading here - http://time-forex.com/terminy/margin-trading
Modern exchange currency trading in practice
Tools of the trade.
the quote itself has the following form EUR/USD Bid 1.2500 Ask 1.2600, the quote value shows how much dollars can buy or sell one euro.
The difference between the Ask (buy) and Bid (sell) prices is called the spread; this is the commission that the broker takes for providing its services.
Intermediary in trade.
You cannot enter the international forex market on your own; this requires a large amount of money and special accreditation, so all trading takes place through intermediaries - brokerage companies .
And in order to trade, you first need to choose a broker; this process is quite complicated and requires making an informed decision, taking into account many components.
The main ones are the presence of the necessary licenses, residency requirements (some brokers do not work with citizens of Russia or the European Union), the size of the initial deposit, the presence of unauthorized strategies.
Equipment.
In order to trade currency, you will need a personal computer or laptop (tablet), a mobile device (phone, Athos, smartphone, etc.) can also be used as equipment, but it is better to start trading from a desktop computer .
Your device must have a stable Internet connection, preferably a cable connection, to avoid connection interruptions.
Special software is installed on the computer - the trader's terminal and with its help all operations are carried out.
Read about the best trader terminals here - http://time-forex.com/praktika/terminal-trejdera
Is it possible to make money from currency speculation?
It is definitely not in vain that exchange currency trading has become the main job for tens of thousands of people; today it is difficult to surprise anyone with the profession of a trader, even in the post-Soviet space.
Real professionals earn stable and quite a lot of money from exchange currency trading; not one profession allows you to get such a high income.
The earnings of TOP managers amount to millions of dollars a year; many of them become owners of their own investment companies.
You will find step-by-step instructions on how to start making money using exchange trading on Forex currencies and other assets in the section - http://time-forex.com/azbuka