Can You Make Money Forex Trading

by Geoff Jones

The whole purpose of Forex trading is to make money. As much as possible. Investors make money on a daily basis and the market changes and moves up and down all the time. Forex trading is basically trading in currencies both your own and foreign ones. It is also known as FX trading. Most people nowadays do it online either through a broker or if feeling braver and thinking they know enough by spread betting either directly or on options and futures.

The main currencies traded are the US dollar USD, Great British Pound GBP and the Japanese Yen JPY. There are of course many other currencies traded and you really have a wide choice of which you trade.

Most people in Europe trade FX by spread betting on currencies directly, futures and options and bonds. This is a good way to trade, as there is no commission so your trading costs are low. The spread betting company makes it's money in the spread, which is the difference between the buying and selling, price.

Spread betting is not too hard to learn but always carries risk for the unwary. For every position you have you must have an idea of how much you are prepared to lose before closing your position. Never forget the key to profits is to close your losses and ride your profits.

In many parts of the USA this type of activity is not allowed as it is classed as gambling. So you will have to use a broker or financial institution before you can make trades. This will involve an upfront cost for each trade.

Whichever type of trading you do, it is essential to educate yourself. There are many sites offering free information and most sites offering any sort of Forex trading will have an education section to help you out. Also remember to only use money you can afford to lose. It may be an old saying but it has some virtue. You can make money Forex trading but only if you spend some time educating yourself first.


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