Beginners Trading Guide
Understanding the fundamentals of the foreign exchange market will provide you with a solid foundation upon which to build your skills, trading strategies and even work towards a successful foreign exchange trading journey. So, let’s start the path with our Beginner Trading Guide. ACM Markets aims to provide resources for traders of all levels to learn and succeed.
Let's start with the basics:
What is Foreign Exchange?
The foreign exchange, also known as foreign exchange or the FX trading, is the process of buying one currency and simultaneously selling another. This process can be performed for a variety of reasons, including commercial, tourism, and to enable international trade.
Before the internet, FX trading was only reserved for banks, large corporations, or high-net-worth clients who traded with a broker over the phone. As the internet age came about in the late 1990s, online trading became possible for everyday individuals.
In foreign exchange, currencies trade against each other as exchange rate pairs. For example, EUR/USD is a currency pair for trading the euro against the U.S. dollar. Traders attempt to profit by buying and selling currencies by actively speculating on the direction currencies are likely to take in the future.
Before the internet, FX trading was only reserved for banks, large corporations, or high-net-worth clients who traded with a broker over the phone. As the internet age came about in the late 1990s, online trading became possible for everyday individuals.
In foreign exchange, currencies trade against each other as exchange rate pairs. For example, EUR/USD is a currency pair for trading the euro against the U.S. dollar. Traders attempt to profit by buying and selling currencies by actively speculating on the direction currencies are likely to take in the future.
Why trade FX?
Foreign exchange is traded 24 hours a day, 5 days a week, by banks, institutions, and individual traders. Because of the global reach of trade, commerce, and finance, foreign exchange markets are the world’s largest and most liquid asset markets.
With a daily turnover of $6.6 trillion, FX trading is 25 times larger than the US stock market, which has a daily volume of $250 billion.
Market participants use foreign exchange for several reasons, including hedging against international currency and interest rate risk, speculating on geopolitical events, and diversifying portfolios. Take a look at the chart below to see how foreign exchange compares to Stocks.
With a daily turnover of $6.6 trillion, FX trading is 25 times larger than the US stock market, which has a daily volume of $250 billion.
Market participants use foreign exchange for several reasons, including hedging against international currency and interest rate risk, speculating on geopolitical events, and diversifying portfolios. Take a look at the chart below to see how foreign exchange compares to Stocks.
Foreign Exchange |
Stocks |
|
|---|---|---|
|
Leverage
|
Up to 500x
|
Up to 2x
|
|
Starting Capital
|
$100 USD
|
$5,000 USD
|
|
Number of Instruments
|
7 major currencies
|
Thousands of stocks
|
|
Trading Hours
|
24 hours
|
8 hours
|
|
Subscription Cost
|
Free
|
Pay for quotes and charts
|
How do I get started?
The easiest way to get started is by signing up for a free demo account. A demo account gives you virtual money to practice trading.
I want to follow and
copy the trades of
professionals
I want to trade on
my own or use an EA
