Knowledge about FOREX..!
@sincere4frdship (2228)
India
December 20, 2011 3:19pm CST
Hello friends...
Recently I have come across this type of earning. Though it's fault of my educational background which didnt let me know these tersm of comerce but I really want to know more about it. Like how can I earn there and what are things I have to care If I start there...
I would be really thankful to them who helps me in starting....
Thanks..
4 responses
@wayhuck (55)
• Malaysia
21 Dec 11
FOREX means FOReign EXchange. It's the exchange between:
1. Currencies
2. Currency and precious metals.
For example:
Right now the rate is RM 1.00 VS $1.00
Now I have $100 USD and I bought RM 100 with it.
Now I'm holding RM 100. If the rate becomes RM 1.20 VS $1.00
and I sell (exchange back to USD), I earn $0.20 for each $1.00 I originally exchanged. 0.20 X $100 = $20.00
This is a very small profits. Most trader trade on leverage. Example, a 1:200 leverage will make your profits 200 times bigger. $0.20 X 200 = $4000
FOREX is very profitable, but is also very high risk.
If rate of RM drops, say RM 0.80 VS $1.00 rate, you lose $4000
Without 1:200 leverage, You lose $20.00
So leverage is a double-edge sword. You can make 200 times more, or lose 200 times more than what you would earn/lose without it.
FOREX rate unlike stocks, moves 24 hours, is unpredictable sometimes and rapid.
You can earn $4000 but find yourself losing everything within next 6 hours if you are not careful enough.
The rate is strongly tied with the countries economy and politics.
For example, if US economy drops, and Malaysia economy rise, it's more likely that RM will exchange for more USD. Not only we look at economy, we look at politics. Reports such as Payroll Data, CPI (Consumer Price Index), GDP (Gross Domestic Product), etc... are also tied.
@wayhuck (55)
• Malaysia
21 Dec 11
Anyway, you stop losing at 100%
If you trade on leverage, brokers will not let you buy RM 100 if all you have is $100
You need to have at least $101 to hold the position. But in this case, a 1 cent drop will automatically liquidate your open position.
You must have more than 100%.
If you have $200, and you use $100 to open position, you would see "200%"
A $1 loss in this case = 1% drop
@sincere4frdship (2228)
• India
24 Dec 11
It was very knowledgable to read you here. But I couldnt understand you comment thing. Stop loosing I know but what about other things which you explained here ?
Thanks
@Yasya08 (213)
• Israel
22 Dec 11
My advice.
1. Demo trade before you go live
2. When you go live, never invest more than you can afford to lose.
3. Choose good broker. My recommendation is forex-metal.com
4. Learn, learn, learn
@sincere4frdship (2228)
• India
24 Dec 11
Thanks for you response. I hope this will be useful as I am using your given site only for demo.
Thanks
@ackyvatsal (39)
• India
2 Jan 12
well first read some free then get some broker that providessome "no deposite" bonus($5,10.15,20).start trading.
i f u get hold of some good scalping tecniques then you concentrate earnig profit immediatly and at the same time learn forex trading in detail.
@Brojon (12)
• Malaysia
26 Jan 12
Try this www.babypips.com and www.forexfactory.com a lot of info about forex
