Posted by Xtreme Pip Poacher
Is it really possible to make money fast with currency exchange trading? There are so many adverts out there that plug strategies to earn money. Is the same true for currency exchange trading?
Forex trading is currency or forex trading. It involves speculating on the rise and fall of currency prices around the world. You exchange one currency for another because you think that the price of one will rise and fall relative to the price of the other.
for example, if the US economy is doing well but the Canadian economy is doing badly, you may want to trade the USDCAD currency pair. You would buy the currency pair implying that you are buying USD. One time when you might want to do that would be if there is a fall in the cost of oil. Canada is a big exporter of oil and the usa is a giant importer, so the value of the US dollar against the Canadian buck is probably going to rise when oil is inexpensive. This could be true even if the US dollar is falling against other currencies.
Of course, if you simply had a couple hundred greenbacks in an account that you wanted to invest in this trade and you were given one for 1 when you purchased this currency pair, you would possibly not make more than a few cents on the trade.