Many investors are fascinated with the possibilities of currency trading. It is an investment market that lets you make money by utilising the fluctuating currency prices across the world. With so many currencies circulating globally, there are opportunities in currency trading tapped by currency trading exchanges across the world.
India is a growing economy and currency trading is gaining the attention of Indian investors. To know more about foreign currency trading watch this Howcast video on “How to invest in foreign currencies?”: https://www.youtube.com/watch?v=y_r5ktFeSnY
Some of the notable facts related to leading currency trading are given below:
- UK is the biggest forex trading country in the world with 41% in transactions of all the transactions around the world.
- In 1973, free-floating currencies became available for trading. Prior to 1973, fixed exchange rates were placed on currencies. In a free-floating market, currency rates are decided based on the demand and supply of currencies around the world.
- You do not buy physical currency during currency trading but gain value from buying/selling currencies of other countries in a virtual environment.gain value from buying/selling currencies of other countries in a virtual environment.
- Currency trading exchange is the most liquid market in the world.
Here are few currency trading terms useful for beginners:
Pip – Any change in the rate of the currency pair is shown as its pip value.
Bid Price – It is the price at which you can sell the currency pair in the currency trading market. It tells you the price at which you can buy one unit of base currency using your quote currency.
Ask Price – It is the best price a trader can offer you for a currency pair at that particular time. Again, this is price you will receive in quote currency for one unit of base currency.
Base Currency and Quote Currency – In a currency pair, the first listed currency is the base currency and the second listed currency is the quote currency. In a EUR/USD currency pair, EUR is the base currency and USD is the quote currency. EUR is the currency to be exchanged for USD at a particular price at a particular time (the current time) in the market.
When you buy a currency pair at the currency trading market, you buy some units of both the currencies in the pair. To understand the market, practice forex trading through simulation games. If you want to dip your feet in real currency trading platforms, start by opening a trading account with a trusted service provider. Educate yourself by learning the terms related to the basics of currency trading.
In the beginning, invest small amounts and focus on a single currency pair. With time you will understand how the forex market works. The currencies are also affected by the impact of local and global events. Try to understand how these events affect the currency pairs that you are interested in investing in.
For investors who are new to currency trading, trading service providers conduct training sessions and share demo videos on how to go about your investments. Also, training is provided to currency traders on how to utilise the trading platform for performing trading actions and monitoring the changes in the forex markets.
USD/INR, EUR/INR, GBP/INR and JPY/INR are the major currency pairs available for trading in India. If you want to diversify your investment portfolio by foraying into the currency trading market in India, then connect with a trustworthy currency trading service provider such as Tradebulls. To know more, visit https://www.tradebulls.in/currency-trading
Need more answers related to the currency trading market, post your queries in comments.