There are not a lot of banks or people who would lend you money for you to trade shares with.
And if there were, it would be very hard for you to convince them to invest in you and in your
idea that a certain share is going to go up or down. Therefore most of the time, if you have
USD 10,000 in your account, you can only really afford to buy USD 10,000 worth of stocks.
When you trade currencies however, you mostly trade on ‘borrowed money'.
what is the forex trading?
What is foreign exchange trading?
The foreign exchange market is where foreign currencies, such as the Euro and the US Dollar,
are bought and sold by individuals, companies, financial institutions and international banks -
everyone if fact, who is looking to benefit from the huge potential for profit from speculation.
Foreign exchange trading has many names; some of the most popular are forex, fx and
currency trading.
When you buy and sell foreign currencies, you are buying one currency against another. This
means that when you see EUR/USD on a trading platform, you can either buy or sell this pair.
If you choose to buy, you will be buying Euros with US Dollars. If, on the other hand, you
decide to sell, you will be selling Euros with US Dollars.
The currencies explained:
EUR = Euro
USD = United States Dollar
GBP = British Pound
JPY = Japanese Yen
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