The increasing popularity of forex trading today has made many investors eager to learn how to trade forex. Thus, we find many today who wish to trade forex but do not know exactly how to go about it. Well, this article has come to relieve you of the difficulties in learning how to trade forex. Beginners will also learn from this work the basic requirements to begin forex trading as well as the best brokers to choose from in case they are having difficulties in identifying the best broker for trading.
What is forex trading?
Forex trading is a global investment package that allows traders to speculate on the future prices of various currencies and other financial instruments in the hope of benefiting from their price fluctuations. The fact that the exchange rate of currencies and other financial assets are very volatile often makes forex trading a lucrative adventure. Hence, traders target to benefit from the price volatility when they make the correct predictions.
How can one trade forex?
There are three different ways of trading forex today. We have discussed them below.
- Personal trading: This involves creating an account with a broker and trading it by oneself after funding the account.
- Robot Trading: This is an automated form of trading where an artificial intelligence called a Robot is designed to take actions on behalf of the trader using some preset patterns. Here, the robot is designed to open and close positions in the market using an in-built strategy developed by the owner or purchased from another dealer. A major advantage of trading with the robot is that it removes the stress and anxiety that comes from trading and allows the trader to focus on other businesses.
- Social Copy Trading Services: This is another way of trading whereby traders are connected to a social trading platform provided by the broker where they can copy each other’s trades. Here traders create their profiles on the platform, and the system provides a Forex Copy Trading option to enable traders to copy each other.
A simple guide on how to trade forex for beginners
There are five major procedures for beginners to follow in trading forex. We have discussed them below.
- Choose a broker: Brokers are the link between the trader and the forex market. They execute the trader’s orders at the market and deliver the returns. Choosing a good and regulated broker is very necessary to protect one’s capital.
- Register an account with the broker: After the trader has identified a good broker to trade with, he will need to create an account with the broker and fill up the registration form provided for new traders on the platform.
- Upload your identity documents: Often, brokers do require their clients to complete an identity verification process that involves uploading their identity cards and any valid proof of address.
- Fund the account: Once the trader has completed the identity verification process, he can now move to the funding menu and choose any convenient method of deposit from the list provided by the broker. The funds will be sent to his account to begin trading.
- Place your orders: The final step after funding one’s account is to proceed to the trading platform (MT4) to place orders after proper market analysis.
Basic requirements for forex trading
The basic requirements for forex trading are A mobile phone or laptop, Good Internet access, a broker, trading capital, and research tools.
List of Best Ten Brokers for trading forex
- eToro
- Capital.com
- Hantec Markets
- ATFX
- Exness
- FXTM
- XTB
- OctaFX
- IC Markets
- Plus500
