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Introduction to Trading

Forex is a decentralized global market where all the world's currencies are traded against each other, and traders make a profit or loss from the currencies’ value changes. Forex Market is also known as Foreign Exchange Market, FX or Currency Trading Market.

Foreign Exchange, commonly known as Forex, is a network of market participants that trade currencies at determined or current prices.

CFD Trading is literally defined contract for difference trading means selling and buying CFDs. There are derivative contracts, because they allow you to speculate in the financial markets; forex, indices and commodities without ownership of the underlying assets.

The size of leverage is not fixed at all companies, and it depends on trading conditions provided by a certain Forex broker.

In trading spread is the ultimate way to speculate the market. It represents the difference between ask and bid price. Maneuvering through buy and sell prices allows you to profit if you end up being correct.

Foreign Exchange market is the largest decentralized market where the volume of daily transactions equals to billions of dollars. The minimum volume of the transaction in the interbank market is too high and is assuredly not accessible for private investors owning small means. Due to margin trading individual investors have possessed an oportunity to make online transactions with various currency pairs.

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The broker charges or pays a certain amount of commission depending on the interest rate differential between the two currencies involved in the transaction, on its direction and volume.

In this artcile we will introduce you to the concept of Pip - the Whats and The Hows. How Pips are calculated and used in trading currency pairs. And will show it on example, so everything will be clear. These are the main themes, we will explore together in this article.