What is Currency trading?
Trading on a currency market needs a proper education and experience on this highly lucrative platform. The currency market which is termed as Forex market is the biggest financial market in the world and is continuing to grow day by day. The daily turnover has crossed more than 4 Trillion US dollars on an average. The market is very large and until sometimes before this market was the playground of big financial institutions and banks. But now it has attracted a big number of retail traders who have found that the Currency trading with XFR Financial Ltd is a good investment to achieve profits.
How does Currency trading at XFR Financial Ltd work?
It is a 24 hour market which is only closed on weekends. Currency trading in Australia is performed in lots which are of various sizes. The micro lot consists of 1000 units of a particular currency. A mini lot is 10000 units and standard is 100000 units of your base currency. For example you are trading with dollars as the base currency then micro lot = 1000 $
Mini = 10000 $
Standard = 100000 $
The currency trading is done in pairs which mean you select a pair of currency to trade always. You buy one currency in Forex trading and sell the other one to trade. The currency prices are shown to the fourth decimal point. A pip is the smallest increment of trading and is 1 % ideally. The potential losses are more manageable to the small investors in Forex trading because of the low investments done as compared to big investors.
What is the reason behind the movement of currency?
There are a number of forces which are responsible for the movement of stock market as well as the currency trading market. The largest factor is the “Supply and demand”. When there is a need of more dollars in the world market then the Forex prices of dollar increase and when there is less demand it goes down. The other major factors which are responsible for shift in Currency market are:
- Interest rates
- Geopolitical tensions
- New economic data from larger countries of the world
- Other bug events in the world
Fewer products to trade
Unlike stock trading and other forms of financial trading, currency trading with XFR Financial Ltd is confined to only 18 pairs of currency. In stock trading there are thousands of stocks available in the market and the trader has a big choice to select the stock he wants to trade. In today’s Forex trading the trader has a limited choice of 18 pairs of currency only and only 8 currencies are often traded as majors. These are:
- US Dollar (USD)
- Canadian Dollar (CAD)
- Euro (EUR)
- Swiss Franc (CHF)
- British Pound (GBP)
- New Zealand dollar (NZD)
- Japanese Yen (JPY)
- Australian Dollar (AUD)