If you are thinking of exploring foreign currency exchange – or Forex, for short, then you need to learn the basics first.
To get you started, you first need to know what Forex is. Simply put, Forex is the trading of global currencies and this is usually done in two ways namely over-the-counter and online trading.
Over-The-Counter Forex Trading
As its name implies, the over-the-counter option is done via personal transactions. This could either be done from bank to bank or from money changers. Actually, some pawnshops in the country even do foreign exchange. Moreover, global money remittances are also available via services such as Western Union, Xoom, Money Gram and others.
Online Forex Trading
Obviously, this one requires the use of online tools accessible from the internet. You can use Forex online trading platforms for your transactions. Additionally, you may also check out live streaming of foreign currencies and Forex trading. Several brokers also offer stocks, futures, and gold with different currencies online.
Compared with over-the-counter, online Forex trading is more complicated.
Tips and Tricks for Effective Forex Trading
If you decide that over-the-counter trading is the right choice for you, then be sure to keep this tip in mind – go for Western Union branches or pawnshops instead of banks.
Why you may ask? Well, it is no secret that bank exchange rates typically benefit the banks themselves more than the Forex traders. Besides, US dollar rates, for instance, are usually higher at selling and lower at buying outside the banks. US $1, for example, could only be at P46.90 at local banks but could be P47.50 when you go with money changers.
So if you have US$500 or more, it would be better to have it exchanged with a Western Union branch (especially those outside malls or banks) or your local pawnshops.
Meanwhile, online trading is recommended for those who are actively trading different foreign currencies. This, as mentioned earlier, is comparatively more complex. The reason is that you will be dealing with world currencies and real-time buying, selling, asking, and bidding.
To make money, you should be familiar with the technical analysis of various currencies. It is also important that you understand about the tools, indicators, symbols, and charts of your trading platform.