How to start Forex trading?
Before starting Forex trading I believe you should ask yourself once again why you want to learn Forex. Yes, mostly the answer will be to make money. Trust me you are absolutely correct at this point. But I have faced some problem when I got into in this sector and the biggest problem is to know the exact answer “How to start Forex Trading?”
got derailed so many times by misleading. I have visited many blogs, websites to gather knowledge about Forex Trading but most of them were for an expert level trader. After few years of struggling, I found the way out. I am giving you the outline to get into it from the beginning to advance level.
The sequence would be like:
1. What is Forex?
Forex, also known as foreign exchange, FX or currency trading, is a decentralized global market where all the world’s currencies trade. The forex market is the largest, most liquid market in the world with an average daily trading volume exceeding $5 trillion. All the world’s combined stock markets don’t even come close to this. But what does that mean to you? Take a closer look at forex trading and you may find some exciting trading opportunities unavailable with other investments.
2. What is Forex Broker?
What comes in your mind when you hear the terms “Broker“? Normally we know a Broker is a person who buys and sells goods or assets for others. The exact same thing happens in Forex Broker either. As the trading platform is online based the broker operate their task using an online trading platform. The trading platform is known as MetaTrader.
If you want to hear it with a bit explanation I might give an example.
First of all, I will talk about a street market. If I want to buy an orange from the market I will go to find a stall selling orange. If I think myself as a seller of orange I will set a stall at the same place because there are buyers waiting for the orange. The same thing happens in the financial market either.
You already have a question how this street market structure relate to the Financial market, aren’t you? In financial market, Forex Broker does the same thing like the street market.
You have buyers and sellers from different financial instruments and they need a place to come together to be able to trade them. In the financial market buyers and sellers can be thousands of miles apart. In order to trade with each other, they need a way of matching their interest. This role is played by the broker. A broker works as a middleman to match you up with seller or buyer. Not only with the trader, the broker connects you with the liquidity provider either. However, it is a trader or liquidity provider you get the opportunity to trade your currency with the liquid market.
Once we had to call a broker to put an order to trade but now this is possible with internet and software on your computer. And we call this software the Trading Platform.
3. How to open an account in Forex Broker?
Before choosing a broker, you should focus on some checkpoint. Their reputation in the market, their trading terms, license or regulation of that broker, desktop and mobile versions of software compatibility with their platform, website security, and payment method security should have been checked before joining with a broker.
Ok, we were about to discuss the process of opening an account. There are few very easy steps.
Enter your information.
Verify your email and mobile number.
They may send some pin through SMS or email just use it on time.
Click register now to finalize.
Now comes the most important stage. In order to fully verify your account, you may submit some documents. Make sure you are providing them accurate information about you. Those documents may be like following:
Passport/ National ID Card/ Driving License/ Voter’s Card or any other identity document that is valid in your country.
To proof Address: Utility Bill (Electricity/ Telephone/ Water) or a Bank/ Credit Card Statement.
Note: If your ID documents provide current residential address then you may not submit any document to proof address.
Don’t forget to take their others instant messaging service methods information like WhatsApp, Viber & Telegram. Ask their live chat they will provide or most of the cases you will get it from the website.
Do not get confused about the trading account. You will get the trading account just after registering with any broker. You have to login into the trading software with that username and password to start trading.
4. What payment processor do I need to use in forex trading?
Normally there are many ways to deposit and withdraw money from the broker. If you have local Mastercard with dual currency or International Mastercard you can deposit and withdraw easily. But there are few little factors we cannot avoid.
Is your county allow forex trading?
Is your country allow international payment gateway services like Payoneer, PayPal and all that.
These two are really a pain sometimes for a new trader. But there is always a way out. You will find anyone of International payment process solution such as Skrill, Payoneer, PayPal, Neteller, Webmoney and all that. Because most of the brokers normally accept international payment system even if your country does not assist you in this case you can have those brokers account.
5. How Much Money Do You Need to Start Forex Trading?
Starting forex does not cost a lot. You can start with $50. Again, you can start with $1000 or more than that. It depends on your strategy and will that how much you want to invest in trading. But starting with minimum $1000 is good for a beginner.
In Forex Trading you have to be focused on money management about the pips movement and your backup money. On an average of 1 pips, you need $100 backup. Though there is no static calculation because there are so many strategies exist to handle the money management during the trading period.
Every trader follows some strategy to trade. And that strategy is the core skill of them. We already shared some trading strategy on our blog. You can visit there to get the idea.
6. How to Deposit in Forex?
This is very easy for anyone. You have to log in to your account on your broker’s website to deposit or withdraw money. Then you will get very few steps to complete the task.
Go to your personal area from your account.
Go to deposit fund option.
Input required information asked about the payment method.
Put your deposit amount.
After completing depositing fund go to your trading software and you will find your depositing money is showing on the balance already.