Beginners Guide to Executing Trades

Beginners Guide to Executing Trades First you must learn the art of trading in foreign exchange markets.

By John W | Oct 04, 2010

Forex, Betting Exchange

Elementary School

Lessons: 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11

In This Lesson

Current Trading Concepts Margin Deposit Currency Pairs Dealing Spreads

Becoming a successful currency trader can take some time, but like with any other aspect of the financial markets, if you train yourself you will improve with time.

In the past traders were limited to banks, government and other big financial institutions, but today anybody with just a few hundred dollars in their pocket can learn about trading in currencies.

The best place to start is by learning some of the concepts involved in current trading, such as margin trading, currency pairs and dealing spreads

A margin deposit is where a trader will begin. If a broker offers a 1% margin deposit he will want the trader to deposit only 1% of the overall amount with which he wants to trade. In layman's terms, this means that a person can trade $1 million by depositing $10,000 or 1%.

All trading in Forex markets is conducted in currency pairs. What does this mean? You buy one currency by selling another, such as buying US dollars by selling euros. This is because trading in currency is quite simply speculating on the value of one currency against that of another currency.

As for dealing spreads, that is the difference between the buying price on a currency pair and a selling price. A trade is concluded once a trader accepts the price and the dealer confirms it.

For more educational material on getting started in currency trading, simply go to eToro online, one of the experts in the business, and select from the dozens of lessons on offer.

Elementary School