Unless you live in a cave (without an internet connection) you will have heard a bit about forex trading. What I've noticed is that there is a fair bit of assumed knowledge around with the topic, so I'll try to discuss basic need to know topics. Yes, forex trading can be a confusing topic to get your head around, but once you understand a few key things you'll be just fine. Don't panic, just take a deep breath and keep reading.
Really basic stuff
Forex trading is basically where you think that the currency of once country will rise or decline in value when compared to another. For example, you may think that the value of the US Dollar will rise compared to the Japanese Yen. The thing about forex trading is that you put up some money to back up what you think will happen. If you're right, you make money, if you're wrong, you lose money. Basic right? Yep it is. In essence that is what it is all about and nothing more. What makes it more complicated is the other stuff. Remember, don't panic.
Forex Brokers and trading platforms
You cannot get started in forex trading without a broker, it's that simple, and as with forex trading courses, the variety of brokers is really amazing â and can be confusing. What a forex broker does is hold your money in an account and place trades on your behalf. Brokers have many different ways to send finances to your account with them â and the most popular include via paypal, credit card, wiring money and via bank transfers. A trading platform is a computer program which displays the current prices of the currencies you wish to place a trade on, and allows you to place orders for your forex trading. These orders go to your forex broker, who in turn places the order on your behalf. Any wins and losses are also visible through the trading platform, so it's basically a line of communication between you and your forex broker.
Sources of information
The amount of forex trading courses can be intimidating and also confusing. There is lots of information around on forex trading from free sources â including websites, forums and newsletters â all you have to do is do a quick search. If you have any questions you need answered, I've always found that most people on forex related forums are very helpful. What's most important is that you get very familiar with the above topics, and some more too before you start trading. I'd definitely recommend trading with a demo account to start with, for a good period of time too â and no two weeks doesn't count! Enjoy!