Forex Trading Introduction
If you’re new to online forex trading then you’re probably new to the term Forex. Forex or FX is a shortening of the words Foreign Exchange and is used when describing the financial instruments of buying and selling currency’s (usually online).  Retail Forex Trading has been growing massively in the last decade because of the many advancements in technology and innovative online forex trading platforms.
Finding a Forex Trading partner
A Forex Trading Broker is an intermediary who has a license to buy and sell forex pairs on behalf of retail forex trading clients. Forex Trading Brokers coordinate real time online transactions between retail buyers and wholesale sellers, usually for a small spread (commission). A Forex Trading Broker will pass your orders to a partner in the Interbank Market to fill your position.
When you close your trade, the broker will close the position for you and credit your account with any gains or losses. A good broker should offer fast, reliable execution of your forex trades and well priced fixed or variable spreads along with 24/7 service.
Forex Trading Expectations
Most forex traders open accounts with unrealistic expectations while they lack both the discipline and the know-how required for successful trading. Forex trading is not a recreational sport and is not the course for fast wealth. Forex trading appears to be much more glamorous than traditional markets like equities, futures, etc. but the rules of finance and common sense apply to all financial instruments.
High Risk = High Returns & Low Risk = Low Returns
However, this is not simply the case because taking a 50/50 chance on one forex trade one cannot hope to make big gains without taking the risk of whipping out the entire account. Research demonstrates that the same forex traders lack discipline and are continually suffering from inconsistent forex trading performance and large capital losses.
Forex trading is not simple and even experienced forex traders frequently incur trading losses. New forex traders must appreciate that forex trading take time to become a skill and there is no fast route towards this goal.
Forex trading offers investors the opportunity to invest in the most advanced financial instrument by buying and selling forex in the global Foreign Exchange Markets. You can start forex trading with a relatively small initial capital investment or you can learn all the forex trading essentials by practising with a free forex trading demo account. A good broker must provide you with an unlimited Free Forex Trading Demo Account to practise in real time. Once you decide you’re ready to take on the markets, you can start trading with a real CashBack or Premium Forex trading account.
What is Trading Leverage?
Leverage, is the amount of money a company will lend you for forex trading, expressed as a ratio between the initial capital invested and the total capital available (free margin). A ratio of 10:1 means that the Broker would lend you €10 for every €1 of actual capital. Some brokers offer as much as 500:1. You have to realize that higher forex leverage translates to a higher risk of a margin call and vice-versa. In any case, leverage is necessary in forex trading because the daily price deviations are usually merely fractions of a cent. However, in the last few years we have seen daily price deviations move in figures thus a low leverage is the smartest way of preserving your capital investment in the longer term.
What is Forex Spread?
The Spread is the difference between the price you buy at (the ask price) and the price you sell at (the bid price). A wide spread means a higher ask price and a lower bid price, which results in paying more when you buy and getting less when you sell, therefore affecting the profit realized from the forex trade. Trading forex with fixed spreads allows you to concentrate on your trades while forcing your broker to absorb any market volatility (highs and lows) in to one stable price. With fixed spreads you always know what you are paying.
Different Forex brokers use different systems or forex trading platforms and will utilize various methods to analyze the forex markets, spot trends and keep abreast of the latest forex trading news. While most cannot offer investment advice, some offer access to training programs so that beginners can learn about the foreign exchange market and the various methods of forex trading. A broker should also offer opinions, research, news and forex trading analysis to help you maximize Return On Investment.
How can we serve you?
Our European regulated, award winning forex trading services and support team can provide you with all the necessary tools, information and support to become a successful forex trader. Call us or request a call-back to help you start practicing with a free MT4 demo account today. We can provide you the necessary information and guidance for free or explain your options between low and high risk investments.
Why choose a Cyprus Regulated Forex Broker
Cyprus has the lowest tax rate in the European Union, which is incredibly attractive to all international Forex brokers. Since joining the European Union, Cyprus has clamped down on unregulated Forex operations, and this has attracted many highly profile firms to conduct their foreign exchange activities with CySEC regulated brokers.
Regulation in Cyprus with CySEC and MiFID
The Cyprus Securities and Exchange Commission (CySEC) is the regulatory body governing financial activity in Cyprus. Foreign exchange brokers must fulfil strict criteria in order to obtain a license from CySEC and also maintain specific capital requirements.
CySEC regulated Forex Trading must be in good standing with all European standards and must be fully compliant to all international laws as well as MiFID. MiFID provides a regulatory structure outlining how financial services must operate across the European Union.
Request a Call Back or email support@tfifx.com to Start Trading Forex with Success!
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