FX Trading

Learn everything on FX trading
with Trade fx group

Forex, also known as FX or Foreign Exchange, refers to the world’s largest financial markets where various currencies are traded. The foreign exchange market is the most liquid market worldwide as more than $6.6 trillion are traded daily. It is a decentralised marketplace meaning transactions are conducted online by banks, brokers, financial institutions etc. FX trading occurs 24 hours a day, five days a week, besides holidays.

Learn everything on FX trading
with Trade fx group

What is FX Trading

Forex Trading is the process of exchanging one currency into another currency for multiple reasons, including ecommerce, trading, or tourism.

Many financial institutions or individual traders can speculate on the movement of a particular currency pair and proceed to post their orders to either buy or sell currencies or set some limit orders.

FX Rates

The value of one nation’s currency compared to the currency of another nation or economic zone is called FX or exchange rate. For instance, in July 31, 2020, the exchange rate was 1.18, meaning that it took $1.18 to buy €1.1.  The difference between them is the FX rate. There are multiple types of exchange rates.

FX Rates

How to trade Forex?

Nowadays, trading currencies is as easy as clicking a button. Anyone can trade and access forex through investment firms, banks, and retail forex brokers, who enable traders to open accounts and start trading. Currencies are listed in pairs when trading them. There will also be a price associated with each pair. In forex trading, currencies are traded in lots, including micro, mini and standard lots.

The most popular currency
pairs are:







How is FX Trading different than other

Firstly, FX trading differs from other markets in that there are fewer rules, meaning that investors aren’t obliged to any standards or regulations like in the stock, futures, or options markets. Being a decentralised market means that there are no central bodies that oversee the forex market.
Secondly, fees or commissions are not the same as in other markets since trading doesn’t take place on a traditional exchange. Also, there’s no limit as to when to trade or buy and sell. As already mentioned, the market is open 24 hours a day, so you can trade at any time. You can even get in and out whenever you please and you can buy as many currencies as you can afford.

Why trade forex?

Forex trading has some main advantages. Initially, there is high liquidity. In fact, the FX market is the most liquid globally. This means that there are large numbers of buyers and sellers looking to place a trade at anytime. As a result, transactions can be done quickly, and spreads are often very low. This also gives traders the opportunity to speculate on price movements.

Additionally, the high volume of currency trades traded everyday results in billions of dollars every minute, which makes the price movements of some currencies extremely volatile, hence there are bigger chances of profits. However, there is also a big amount of risk involved.

Finally, there is a possibility to trade on a wide range of major currency pairs with high leverage depending on the forex broker you choose. Last but not least, the flexibility in trading hours makes it one of the most frequently chosen markets.