Understanding the Basics of Forex Trading

Forex trading or Foreign Exchange Trading refers to the simultaneous trading—that is, buying and selling—of two different currencies. It is done between and among major financial institutions, central banks, small retail currency traders or speculators, large international companies, government institutions, companies with overseas operations and the like. 

Understanding Forex - #1 - What is Forex?

This is a series of articles about The Foreign Exchange Market. You will learn here what Forex is , how it works and how profitable it can be. The whole series contain  the following articles . . .

Understanding A Forex 'Carry Trade'

Recently, the breakdown of the "yen carry trade" has graced the front page of major financial newspapers and business magazines. But what is a "carry trade" and how does it affect the forex? More importantly, how can you, as an individual investor, profit from carry trades? This article endeavors to provide the answers.

What is a Carry Trade?

First, it is important to remember that each forex trade is actually the simultaneous buying of one currency and selling of another. As a result, you end up receiving interest on the currency you purchase, and paying interest on the currency you sell. A carry trade takes advantage of this by seeking out high-yielding currencies to purchase while simultaneously selling low-yielding currencies -- allowing the trader to pocket the difference in interest rates.

Trading Smart In The Forex Market

Hundreds of thousands of individuals have already joined the FOREX market. If you are interested in a way to invest your money with quicker returns, FOREX may be perfect for you. But before you can begin earning money, you should thoroughly understand the FOREX market.

Investing Methods

To better understand the FOREX market, you can compare this investing method to trading stocks. In the stock market, you can buy shares of many different corporations in the hope that stocks will rise, earning you a profit.

Trading Psychology: Mistakes in a Trading Environment.

When it comes to trading, one of the most neglected subjects are those dealing with trading psychology. Most traders spend days, months and even years trying to find the right system. But having a system is just part of the game. Don’t get us wrong, it is very important to have a system that perfectly suits the trader, but it is as important as having a money management plan, or to understand all psychology barriers that may affect the trader decisions and other issues. In order to succeed in this business, there must be equilibrium between all important aspects of trading.