Do you think you’re reading to start in forex trading? To boost your confidence, make sure you know at least the basic terms often used in the market. This way, you will not be lost while dealing with other Forex traders or when doing your research about what to do as a first time currency trader. Here are the jargons that you have to be familiar with while engaging in currency trading:
- Exchange rate. This is the rate at which a currency can be traded in for another. The currency market is all about these exchanges. You can look at economic calendars to guide you in predicting which currencies would increase or love in value during a certain trading time period.
- Pips. These refer to the points that you need to monitor to let you know if you will gain from a trade or not. They may reach up to the fourth decimal, such as 0.0001, of the currency. Even if there are only minor changes in the value of the currencies, you can still make a profit if you trade them in large amounts.
- Margin. This is the amount of money that you have to invest in the Forex market, something lower than when you have to invest in oxy or other stocks. This is a short-term loan that you get from a broker so you can start trading. Margin is also called leverage.
- Ask price. This refers to the amount at which you would like to sell your currency. But first, you need to understand offer numbers and how much you will have to pay for the currency.
- Demo. This is a Forex trading program that gives you a glimpse into the market. Through this, you will learn the basics in trading and ways to make a profit. Unlike in vàng quốc tế, you can get a demo in Forex.