Make Money in Forex-Trading







If you’re looking for a way to earn killer income online, you might have heard something about Forex. More often than not, Forex ads scream about easy income, big gains and low risk. No wonder why Forex trading is incredibly popular among experienced and new investors. While it may be really easy to start Forex trading, it’s not that easy to generate big profits through Forex trading. The cases are not rare when Forex beginners get frustrated and quit the market because this system seems too complicated for them. In fact, it’s no more complicated than any other investment scheme.

Forex is the global 24-hour market, in which national currencies are traded. Forex (FX) stands for the foreign exchange market. With the $4 trillion daily turnover, Forex is the largest and most liquid market in the world. It is also worth saying that Forex is not a physical market like the New York Stock Exchange for instance. The Forex market is more like a global network of dealers, including central banks, currency speculators and other banking and financial entities.
The origin of Forex trading

The history of foreign exchange trading can be traced back to the Middle Ages when currencies were converted into a single currency. In those days, the foreign exchange markets were quite primitive, currency exchanging was stable and involved almost no risk.

The volatility of the Forex market increased greatly after WWI. For years, the international economic system had been supported by the price of gold. But that standard had many weaknesses. One of the most serious weaknesses was the so called boom-and-bust pattern. In 1914, after WWI, many nations took their currencies off the gold standard and started dictating the value of their currencies.

The Bretton Woods system also played a great role in the evolution of the Forex market. This system was established near the end of WWII to design a new stable economic environment. Under the Bretton Woods Agreement, national currencies were fixed against the U.S. dollar. The U.S. dollar in its turn could be exchanged for gold at a price of $35 per ounce.

Governments were supposed to have dollar reserves, and if the economy needed an inflow of money, the government exchanged reserve dollars for its own currency and thus injected money into the economy. As a result of the Bretton Woods Agreement, the U.S. dollar became the international reserve currency, which could be converted to gold.

The foreign exchange market as we know it today was formed in 1971, mostly due to the abandonment of the gold exchange standard by the international economic community. In 1978, the free-floating system was officially mandated, and the currencies of the industrialized nations began to move freely across the nations. In view of the fact that supply and demand is the fundamental factor of Forex trading, the free-floating system became ideal for the Forex markets.
Until very recently, foreign exchange trading was accessible only to big players, including major banks, hedge funds and other institutional traders. The advancement in online technologies accelerated the further expansion of the Forex markets all through European, Asian and American time zones.

Today Forex is an extremely lucrative market with the obvious benefits. FX comes as a profitable alternative to some more common investment schemes, such as trading stocks and bonds. With the Internet being the main means of foreign exchange trading, this investment doesn’t require much time and physical involvement. This market functions 24 hours a day, so you can participate in foreign exchange trading anytime that’s convenient for you. Another great thing about the Forex market is its liquidity. In addition to that high leverage offered by brokers encourages players to trade for big profits.