As one of the few occupations that were not affected much by the COVID-19 Pandemic, let us delve deeper into why they were not affected. How are they earning? What is forex? How can it help you out? Let us now delve into forex basics.
What is Forex?
For a start, forex stands for Foreign Currency and Exchange. The task is usually placing different types of currency unto each other for a plethora of reasons, like commerce, trading, tourism, infrastructure, oil, and even cryptocurrency! As the forex market usually is dabbling on business and finance, the markets tend to be the most liquid asset markets that you can be in. You don’t have to worry about long wait times as it will reflect on your account in real-time.
Interchanging the Currencies in the Forex Market
How does forex work? Let’s take this example: Money is relatively limited in all countries. You cannot just print money indefinitely as it would cause your currency to inflate and lose value over time. Printed Mints have value due to their limited production and how much your country is currently holding.
Now let’s go to the next step. Let’s say your company from Europe sells fuji apples from Japan. You wouldn’t use your currency directly to purchase the apples. It would be best if you had a medium for that, and that is the US Dollar. You would need to change your Euros to USD first before you can purchase the apples from Japan, and the same goes for the latter.
The supply and demand of those three currencies with their limited amount in return will dictate the price depending on how much coins they are holding against the said country.
What is the History of forex?
Everythings got to start from somewhere, correct? The same goes for the ForEx market. Unlike the stocks that have been alive since time immemorial, the forex market is considered a new market. It has started since the nations started minting currencies. But the modern forex markets are what revolutionized everything. After the Bretton Woods accord during 1971, most currencies were allowed to vie for financial advantage.
How to start forex?
It has a complex structure yet very simple as all you need to think of is this, “Whatever goes up, must come down.” Currencies aren’t stagnant, They change on a day to day basis and will forever be that way as long as we are using the currencies against each other. You need to follow the pattern and see whether it goes up or where it goes down. Check the amount you have in your account, follow the 2% rule, check the trade, Push either BUY or Sell and go. You only need to wait and develop some more news on the currencies you are currently trading to see where it goes.
Trading currencies can be a challenging but very loveable way of making more money. You can do it during your free time and leave it while you are doing what you need to do, like your full-time job. You can also opt to have a broker do it for you! But that’s going to be another topic for another time.