Tuesday, 16 September 2008

FOREX - A Business for All

Earning extra money from dealing the International Exchange Marker sounds like a big business and over most people’s heads. Well that not the case in this instance. A scheme under the name of FOREX which short for Foreign Exchange has brought this business to everyday people like you and me. You don’t need to deal in millions to make money here.

Around the world there are dealers who will give you a price on major currencies. Investors buy certain currency thinking it increase in value against other currencies and when it does they sell it for a profit.

Another way is to try and make profit without the wait where a sell high and buy low betting that the currency is about to fall in value.

You need money to do this of course and what makes it accessible to everyday folk is a system called 'leverage' This is a facility where capital can be borrowed capital that funds are big enough to trade with or to reach the minimum to do a transaction. The trader will have to fund with a deposit of around 1 – 4% to secure the bigger funds to trade with This deposit fund is called the margin.

For every pound or dollar you fund you can get 100, 200 or 300 times this amount from brokers So with £1,000 you control £100,000 of currency.

This means you can make or lose big sums although in actual fact you only lose the margin you put in.

I have given an example of how this business works.

Deposit £1000 with leverage of x 100. This gives you control of £100,000.

You believe the value of the US Dollar will rise so you invest the full amount in US Dollars.

30 minutes later you assumption was right and the Dollar rises in value against the British Pound by 0.5%.

Quickly, you sell straight away and you have made £500! It could of course go the other way and drop of course if you get it wrong and the British Pound could drop in value by 0,5%% and you’d lose your £500. This happens all in the space of 15 minutes.


FOREX trading is a great way of making money on the Internet and is open to everyone. A small investment and an online facility and you are away. Big profits can be made quickly but losses can also be made too just as quick.

There is no substitute for experience in this business and to help you there are many sites that give demo in which you can participate in before going live.

- A free demo site to try out

www.odlsecurities.com/ - There is a free Forex demo download offered on this site

www.fxcm.com/ - Here they let you 'Play before Pay'

www.dbfx.com/ - This site give the offer of a 'Trial Account'



No comments: