Trading Archives - Kids Ain't Cheap

A little extra income is always a good thing, so when you find a new way of making money, it can be very exciting. Forex for instance, can be a great way of earning money. The financial markets may seem like they are out of reach for the average person, but in fact, nearly anyone can invest. In fact, all you really need is to start a forex funded account with FTUK.

Here is some more information about forex, including how it works and who should use it.

How Forex Works

Trading on the forex market is all about speculating whether you think a currency will increase or decrease in value against another one, for instance GBP/USD. The ability to speculate on prices falling as well as rising is one of the reasons forex is so popular. Factors that influence your decision can include news reports on a country’s economic activity, fundamental analysis and complex technical analysis. If a currency looks like it’s going to strengthen, then it would be reasonable to invest money in it doing so.

There are a number of products associated with forex, and two of the most popular; spread bets and contracts for difference (CFDs) do not actually involve buying or selling currency. They are both relatively similar in that profits and losses are made by the amount to which a prediction is correct. A CFD is an agreement between buyer and seller to exchange the difference in price between the current value of a currency and its value at the end of the contract. A spread bet is simply when money is wagered on the fluctuation of a currency; with more being won the further the price moves in a favourable direction. Of course you can always follow the traditional route of actually buying currency and profiting from its increased value, or vice versa if you sell.

Forex is For Anyone

Now you’re probably thinking that this is all very well, but the financial markets are only for those with large investments to hand. This is no longer true, and you can in fact trade with hardly any money at all. This is done through leverage, whereby you only have to deposit a small amount of money in order to place orders of a much higher value. For instance, you may only need to deposit 100 units of a currency to buy or sell 10,000 units of it. This is great if you don’t have a large amount of capital to work with, but be aware that there are risks involved in forex, and you can potentially lose more than your initial deposit.

All you need to get started is some knowledge of how the system works, which is easily done by reading guides on forex trading for beginners. The ony other thing you’ll need to start is an online account with a good broker. It really is very easy to get involved. If you’re looking for some extra money and have thought about investment, then forex trading could be for you.