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Since we decided to dedicate ourselves to investments, we have heard of Forex numerous times. The forex market is one of the most popular in the world, but do we really know it? Now you have the possibility to know what is Forex, how it operates and all the financial products that we have available to make our investments.
The Foreign Exchange Market, better known as Forex, is the most important financial market in the world. Millions of operations are carried out at the end of the day and it is a market in which we can invest 24 hours from Sunday to Friday.
We enter Forex
Forex offers us the possibility of investing in a large number of financial products, we mean coins. Yes, the currencies that correspond to the economies of most countries or economic communities, such as the European Union.
One of the main advantages of this market is that it does not have a physical location, so all the actions that we can carry out will be carried out electronically, which makes these actions even easier. So much so, that in a day Forex can register up to more than 4 trillion of traded volume.
When handling such amounts of money, at first the exchange market was achievable for very few, mainly large companies and international banks, however, little by little Forex became more popular and today, has many different types of investors, from multinational companies to individuals.
Currency trading
Despite being a very popular market, trading Forex is not an easy action. Although it is true that we have a large number of currencies, the reality is that before taking any action, it is recommended that we study and analyze all the movements that have occurred in the market, as well as the changes experienced by our own. values.
We must not forget that Forex is a highly fluctuating market, which depends directly on the economies of the countries.
This is the slowest step, since it will take us a while to know all the ins and outs of the market. But once we have it under control, operations will roll, since the next step we must take is to select in which trend we want to direct our investments.
Remember that currency pairs can move up or down and for this reason you need to know what factors are affecting economic systems. What we do here is obtain a share in one of the economies present in the market and the operation consists of comparing one currency with anotherTherefore, products are always bought in pairs, in other words, we work on two values.
What currencies are the most popular?
With respect to the currency pairs we have available, these are diverse, even when the most popular is the dollar-euro (USD / EUR). The US currency is the main currency investors work with, followed by the European value, the Japanese yen and in fourth place, the British pound.
Even though most of the operations are carried out through these currencies, it does not mean that they are the only ones that Forex makes available to us, since in this market we also find others such as the Swiss franc, the Canadian dollar or the Australian dollar.
To operate in Forex we have as a reference the three main world stock exchanges. We refer to the one in Tokyo, which opens at 00:00 and closes at 09:00; On the other hand, we can also invest in the one in London, in its morning session from 08:00 in the morning until 17:00 in the afternoon; and to finish the New York Stock Exchange, in the afternoon from 1:00 p.m. to 10:00 p.m.
What advantages does this market offer?
As we have been telling you, Forex is one of the most important financial markets in the world, both for the number of operations carried out daily, and for the volume of business it generates. But it is that investing in this market offers us a large number of advantages, which is why it has gained so much popularity in recent years.
The first thing to highlight is that all the operations we carry out in Forex do not carry any additional commission, they only charge us the respective spread but this is usually quite low, the normal thing is that it is around 0.1%, a ridiculous figure.
Además hay que tener en cuenta que podemos operar de forma directa en el mercado, sin necesidad de usar los servicios de un intermediario. Sea cual sea el caso, si lo pretendemos siempre podemos hacerlo a través de un specialized broker like eToro, IG Markets, Plus500, etc. but this is a free alternative.
At the same time, remember that Forex is open 24 hoursFrom Sunday night to Friday afternoon and to operate we have available the three main exchanges that we have discussed in the previous chapter.
At the same time, the lots that we can obtain are very flexible, with only a small initial amount of money, we can achieve great benefits, all this, adding the leverage that it offers, with which we can generate a large volume of capital. Therefore, we will also have high liquidity.
Finally, as an additional advantage, it is important to note that to invest in currencies we can do it by making minimum deposits, reaching an amount less than $ 500, which makes Forex achievable for everyone.
