Forex remains the biggest and most liquid financial market in the world, so big that it makes the stock market appear small. When you step into this market, you are supposed to trade currency pairs. It might sound pretty straightforward, but there is some training required before you can make it profitable for you. Of course, Asset X Pro has all the training materials and educational resources to train you on basic to advanced trading strategies.

However, before you get into that, let us help you get a basic understanding of forex trading.

What Is Forex Trading?

Forex, also known as “FX,” is short for “foreign exchange.” The foreign exchange market is a global decentralized market where traders can buy, sell and invest in currencies. This market allows you to trade different currencies against each other and earn a profit according to how the values of those currencies change over time. For example, if you think that the value of one currency will increase relative to another currency (like dollars compared to euros), then you could buy that currency and sell the second one—earning money from the difference between what it costs you initially plus any gains or losses on your investment as time passes.

This marketplace is huge. In 2017 alone, there was $5 trillion worth of transactions made every day in this financial industry worldwide!

A Few Basics of Forex Trading

It's important to understand how the foreign exchange market works. The forex market is made up of two things:

Currencies - These are the assets you trade in when you buy or sell a currency pair. For example, if you were trading USD/CAD (US Dollar vs. Canadian Dollar), then USD would be the base currency, and CAD would be the counter currency.

Pairs - A pair consists of two currencies that form an exchange rate between them. For example, USD/CAD forms a pair and is traded as 1 USD = 1.2896 CAD, meaning that one US dollar is exchanged for $1.29 Canadian dollars on average over time as a result of buying and selling activity within this pair on exchanges around the world; this means that since both currencies have their own exchange rates they will fluctuate independently from each other which results in fluctuations between pairs such as EUR/USD or GBP/JPY, etc., but those will vary depending on what news happens around them."

What Budget Is Needed to Trade Forex

How much money you will need to start Forex trading depends on the type of account you choose. There are many types of accounts, but they can be grouped into two main categories: individual and corporate.

Your personal account is basically an online banking account (with or without a debit card) that allows you to trade digital currency. This type of account has little to no minimum deposit requirement and offers low spreads (the difference between buy and sell rates).

You should have just enough money to spare for trading and to keep things running smoothly in your life. Regardless of how much money you have in savings, it makes sense that you devote only 10% to 20% to trading. Even in that 10%, you should divide it into several parts, meaning you should trade progressively rather than putting all of that money into trading forex.

The Different Types of Forex Orders

There are different types of orders that a trader can use to place his/her trade. They can be categorized into two types: market and limit.

Market order: A market order is an instruction given by the trader to buy or sell currencies at the current market rate. This is considered the simplest type of order because it doesn’t require any time frame, but there could be situations when you don't get a fill price (i.e., your trade isn't executed). If this happens, then it's up to you whether you want to cancel your order or not.

Limit Order: A limit order is an instruction given by a trader with respect to buying/selling currency pairs at a specific price range with pre-defined stop-loss and take-profit levels in mind before placing trades on Forex markets.

Foreign Exchange Risk and Benefits

There are two main benefits of forex trading, the first being that it is a leveraged product. This means that traders can buy or sell larger amounts of currencies than what they have in their accounts. The second benefit is that you can trade all day, every day. With stocks and commodities, there are certain times when you’re allowed to trade them, but with forex, you don’t have those same restrictions because it is an international currency market (i.e., open 24 hours).

However, it is important for you to keep in mind that when you trade with Asset X Pro, we provide you with access to these markets through CFDs, which are contracts. In other words, when you trade on our platform, you don’t buy or sell the assets themselves.

Understanding Spreads

The bid-ask spread is the difference between the price at which you can sell and buy a currency pair. The bid price is what it costs to sell the base currency (or most liquid trading markets), and the asking price is what it costs to buy that same base currency. For example, if 1 EUR/USD = 1.25000, then it would cost $1.25000 to buy 100 Euros in this market, whereas selling 100 Euros would yield you $1.24500 in return (assuming no interest rates).

It is important to mention here that once you start trading with Asset X Pro, you will benefit from some of the most market-competitive spreads. We kept spreads tight so you could keep the major portion of your profits with you.

Forex Trading with Asset X Pro

You have made the right choice by landing on Asset X Pro’s website, where we provide hundreds and thousands of traders from around the world with the opportunity to trade in the forex market through our robust trading platform. Sign up with us today and take advantage of leveraged forex trading.