General Information About Forex.
Forex (Foreign Exchange Currency Market) – is the international interbank foreign exchange market. Founding date of the Forex market is considered to be January 8, 1976, when at the ministerial meeting member countries of IMF in Kingston (Jamaica) it was adopted a new agreement about the structure of the international monetary system, which took the form of amendments to the charter of the IMF. The system replaced the Bretton Woods monetary system. Starting from this moment freely floating exchange rates have become the only way to exchange currencies. In a new monetary system finally there was a refusal of the principle of determining the purchasing power of money based on the value of gold equivalent. Money of countries parties of the agreement ceased to have official gold content. Exchange began to occur in the free market at free prices.
Currency Forex market is a separate species of the world financial market. The aim of traders is to get profit from the purchase – sale of foreign currency. Exchange rates, which are in the market turnover, are constantly changing due to changes in supply and demand, severely affected by any important for human society event in the field of economics, politics and the environment. As a consequence, the present value of foreign currency changes in one direction or another. Using this change in accordance with the known principle of the market “to buy cheaper – to sell higher price, the trader makes a profit. Comparing with other sectors of the financial market, currency market Forex has fast reaction to the impact of multiple and ever-changing external factors, accessibility to all individual and corporate traders, the extremely high turnover, which creates a warranty of liquidity in currency rates, around the clock functioning, allowing traders to work not in normal working hours or during national holidays in their countries, using the foreign markets running at this time. Like in any other market, trading in the Forex market with its exceptionally high potential profitability is fraught with a considerable risk.
Success on Forex is only possible after some training, which includes familiarization with the varieties and market structure, the principles of currency pricing factors affecting the change in prices and risk in the trade, sources of information for taking into account these factors, methods for analyzing and predicting market movements, the rules and tools of the trade. In preparation for trading in the Forex market, training with a demo account plays an important role that allows you to practice the theoretical knowledge and acquire the necessary minimum trade experience without the risk of property damage. The main participants in the foreign exchange market are: commercial banks, currency exchanges, central banks, firms engaged in foreign trade operations, investment funds, brokerage firms and private individuals.
There are two options you can make money on Forex.
Or you can hire experienced traders to manage your account and they will trade for you. Find out more about forex investment.