Earn More Money from ForEx Trading

It is a known fact that ForEx trading, unlike other trading market gives more benefits to its investors in a shorter period. ForEx trading is like stock trading or commodity trading. The only difference in ForEx trading is that you are going to trade currencies of different countries to make profit. ForEx trading takes place every minute of the day and for the entire business days in a week. The value of currencies change every single minute, which makes ForEx market a continuous changing market.

As already said, you are going to trade currencies in pairs. In order to understand, check out the following example. Let take that you are going to trade US dollars and Euro. Today the ratio of EUR/USD is 1.40876, that is 1EUR = 1.40876 USD. Decimal points go to 5 digits and the last digit is called as PIP. Euro is your base currency and USD is your counter currency. If you are going to buy 1000 Euro, you have to pay $1408.76 today.

Lets us assume that the ratio EUR/USD = 1.53428 the next day. Therefore, if you sell your 1000 Euro the next day, you will get $1534.28. This brings you a profit of $125.52 in one day. This is what happening in ForEx trading. Once you are familiar with the currency that is trading well, you can make profit in few days. Usually, in ForEx trading you can buy 1, 00,000 units of a particular currency. If you feel that this is too high, you can check in some online websites where they offer even smaller lots of units for starting your ForEx trading. The change mentioned here is an example and usually the ratio varies slightly per day. The variations take place in their last digit and the variations are denoted as 1 PIP or 5PIP’s. make sure that you make a thorough research before investing in real ForEx market.