Author Topic: Guide to FOREX  (Read 1529 times)

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GreenMoney

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Guide to FOREX
« on: September 12, 2013, 12:35:34 AM »
What is Forex?

If you've ever traveled to another country, you usually had to find a currency exchange booth at the airport, and then exchange the money you have in your wallet (if you're a dude) or purse (if you're a lady) or man purse (if you're a metroual) into the currency of the country you are visiting.

You go up to the counter and notice a screen displaying different exchange rates for different currencies. You find "Japanese yen" and think to yourself, "WOW! My one dollar is worth 100 yen?! And I have ten dollars! I'm going to be rich!!!" (This excitement is quickly killed when you stop by a shop in the airport afterwards to buy a can of soda and, all of a sudden, half your money is gone.)

When you do this, you've essentially participated in the forex market! You've exchanged one currency for another. Or in forex trading terms, assuming you're an American visiting Japan, you've sold dollars and bought yen.

Before you fly back home, you stop by the currency exchange booth to exchange the yen that you miraculously have left over (Tokyo is expensive!) and notice the exchange rates have changed. It's these changes in the exchanges rates that allow you to make money in the foreign exchange market.

The foreign exchange market, which is usually known as "forex" or "FX," is the largest financial market in the world. Compared to the measly $74 billion a day volume of the New York Stock Exchange, the foreign exchange market looks absolutely ginormous with its $4 TRILLION a day trade volume. Forex rocks our socks!



The currency market is over 53 times BIGGER! It is HUGE! But hold your horses, there's a catch!

That huge $4 trillion number covers the entire global foreign exchange market, BUT retail traders (that's us) trade the spot market and that's about $1.49 trillion. So you see, the forex market is definitely huge, but not as huge as the media would like you to believe.

Do you feel like you already know what the forex market is all about? We're just getting started! In the next section we'll reveal WHAT exactly is traded in the forex market.

What is Traded?



The simple answer is MONEY.

Because you're not buying anything physical, this kind of trading can be confusing.

Think of buying a currency as buying a share in a particular country, kinda like buying stocks of a company. The price of the currency is a direct reflection of what the market thinks about the current and future health of the Japanese economy.

When you buy, say, the Japanese yen, you are basically buying a "share" in the Japanese economy. You are betting that the Japanese economy is doing well, and will even get better as time goes. Once you sell those "shares" back to the market, hopefully, you will end up with a profit.

In general, the exchange rate of a currency versus other currencies is a reflection of the condition of that country's economy, compared to other countries' economies.




Why Trade Forex?

Want to know some reasons why traders love the forex market? Read on to find out what makes it so attractive!

Lessons in Why Trade Forex?

Advantages of Forex
Low transaction costs and high liquidity are just a couple of the advantages of the forex market.

Forex vs. Stocks
Nobody likes bullies! Good thing for us, unlike the stock market, there is no one financial institute large enough to corner the forex market!

Forex vs. Futures
The futures market trades a puny $30 billion per day. Thirty billion? Peanuts compared to the FOUR TRILLION that is traded daily in the forex market!

How You Make Money in Forex

In the forex market, you buy or sell currencies.

Placing a trade in the foreign exchange market is simple: the mechanics of a trade are very similar to those found in other markets (like the stock market), so if you have any experience in trading, you should be able to pick it up pretty quickly.

The object of forex trading is to exchange one currency for another in the expectation that the price will change, so that the currency you bought will increase in value compared to the one you sold.

Example:

Trader's Action   
You purchase 10,000 euros at the EUR/USD exchange rate of 1.1800

EUR   +10,000
USD -11,800*

Trader's Action
Two weeks later, you exchange your 10,000 euros back into U.S. dollar at the exchange rate of 1.2500   

EUR    -10,000
USD +12,500**

Trader's Action
You earn a profit of $700

EUR   0
USD +700


*EUR 10,000 x 1.18 = US $11,800

** EUR 10,000 x 1.25 = US $12,500


An exchange rate is simply the ratio of one currency valued against another currency. For example, the USD/CHF exchange rate indicates how many U.S. dollars can purchase one Swiss franc, or how many Swiss.

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Guide to FOREX
« on: September 12, 2013, 12:35:34 AM »

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NeoGemini

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Re: Guide to FOREX
« Reply #1 on: September 12, 2013, 12:41:44 AM »
sa totoo lang medyo nakakalito yung mga terminologies tsaka yung strategy sa forex.

Inaaral ko din sya. Paano nga ba gumagana ang forex? Tsaka paano nagkakapera yung mga traders?





GreenMoney

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Re: Guide to FOREX
« Reply #2 on: September 12, 2013, 12:42:23 AM »
@neogemini, nakita mo na eto?

Lesson 1 - What is Forex and how does It work?

PinoyLife

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Re: Guide to FOREX
« Reply #3 on: September 12, 2013, 12:56:18 AM »
@greenmoney, kumikita k n b s forex n to? gusto ko rin subukan wala ko knowledge about this. meron b seminar para dito? sana yung libre lang.

DI ko rin halos maintindihan si mr foreigner sa video e.. wala ba nung tagalog man lang o kaya kahit video for newbies?


Your smart guide to money matters and entrepreneurship";}

GreenMoney

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Re: Guide to FOREX
« Reply #4 on: September 12, 2013, 12:57:20 AM »
@PinoyLife... Meydo medyo :)

You can check this video.

Forex Tutorial (for filipinos)

mjvillena

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Re: Guide to FOREX
« Reply #5 on: September 17, 2013, 09:30:20 PM »
hi @neogemini you can check this blog

may mga videos ng forex 101 dyan

www.spreadpips.blogspot.com

NeoGemini

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Re: Guide to FOREX
« Reply #6 on: September 18, 2013, 09:26:52 AM »
@mjvillena.. are you into forex ba?

kamusta experience mo naman so far?

PesoRepublic.com | Your smart guide to money matters and entrepreneurship.

Re: Guide to FOREX
« Reply #6 on: September 18, 2013, 09:26:52 AM »

 

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