Forex Market

Forex market is the biggest financial market in the world. Moreover, currency trading is one of the fastest growing forms of investing.

Here’s how to find information and resources to deepen your knowledge about the fast and exciting world of foreign exchange and how to use it for trading purposes.

Internet has changed the way people view forex markets. No longer are the best currency analyst reports unavailable to the public, live real-time data too expensive for common investors, or capital requirements too high.

In fact, many companies have introduced mini forex accounts, with starting capital requirements for selected accounts in some brokerages under $1000. These smaller accounts have made currency trading available to everyone, increasing the need to be educated on forex and currency trading.

Ways to Learn About Forex Markets

There are many ways you can learn about forex markets. If you’re a business student, many universities have classes in foreign exchange operations and macroeconomic mechanisms that affect currency fluctuations.

Outside of the formal education field, you can learn about forex and currency trading from traders, salespeople, and analysts. Moreover, you can learn foreign exchange operations from educators through specifically arranged seminars, courses, and mentoring.

And don’t leave out forex magazines and books for background information and latest news to keep you ahead of the curve.

Forex Trading Systems and Solutions

Once you’ve covered the basics of foreign exchange operations, you might also want to know the ways currency trading is done, through brokerages, forex trading systems, and with different currency trading systems.

The tools and services you’ll need for you own forex trading or operations will depend on your particular approach to forex.

In fact, many corporations do not want to take any risks with forex fluctuations and will hedge their positions. Others, traders and speculators, seek to profit from the fluctuation with their systems and views.

From this site, you’ll find information on resources that will help you understand better the complex world of investments for forex markets and currency trading.

There is also a complementary website for information in languages other than English for 外汇, 외국환, Forex Português, and иностранной валюты.

Investment

The world of investments is an ever-expanding field of different financial instruments and markets to choose from. Financial market innovation ensures that keeping up with the new financial products and starting research the markets on your own can be an overwhelming task. 

Here, you'll find basic information on some of the major instruments and markets, all in one place, to help you on your research efforts. This way you'll save time and effort, which can be put to better use, researching the actual companies or financial products. 

Sometimes investors keep their field of knowledge too narrow. By expanding your knowledge about the different markets and financial products, you may get new investment ideas, portfolio weighting strategies, or risk management tools, for example. 

Keeping Up with the Market Changes


In addition to the basic information, this site has been designed to offer advice on further resources and educational tools. Most of the further resources, apart from professional market training, are completely free, providing a great return on invested time, to put it that way. 

The articles put emphasis on the major financial product areas, but you'll find discussion on the on-going innavation in this field, which continuously provides links between different product areas. 

For example, financial innovation has brought us credit derivatives, new commodity markets (such as emission trading), and negative coupon bonds, to name few examples. You might also be interested in forex investing. 

The areas covered include: 

investment go-betweens (banks, advisors) 
different types of investment funds 
the dark side of investing (fraud) 
international aspects of investing 
and much more. 

Put together, you'll find a well rounded view on financial education, research resources, and financial markets, to get you to the next level on your efforts to become a better investor.

Trading Information

Currency trading information needs are various. Depending on your particular strategy, you might need real-time charts, news feed, and real-time third party analysis.

The most rapidly expanding group of currency traders is those using mini forex accounts and other online forex accounts with smaller account sizes.

The high-end FX trading information sources, such as Bloomberg and Bridge, are very much out of the small investors price range. However, for larger corporations and individuals with larger accounts, these tried and trusted systems are the obvious choice.

The affordable choices for information sources are free online news feeds, your brokerage's news feed and analysis tools attached to the software platform, and other online resources.

Affordable Currency Trading Information Sources


If you don’t yet have a brokerage, chances are that you can get a variety of information and analysis tools in the package, at least if you go with one of the online brokers. 

Many online brokers add real-time news feed, real-time charts, email alerts, and (technical) analysis tools in their platform package. Not all do, so you should check the details before signing up with a brokerage.

Other affordable information sources include such online web sites as INO.com, Traders.com, Bloomberg and Reuters web sites.

You can also sign up with one of the online companies offering forex analysis for a fee, such as OzForex or Investica. Many of these services send, for example, end-of-day analysis packages via email.

Professional Currency Trading Information Sources

For larger corporations and individuals with larger forex accounts, the professional systems are a natural choice. Companies offering professional platforms include

Reuters
Bridge (Reuters company)
Bloomberg
ILX Systems (Thomson company)
Primark Corp.
FactSet Research Systems


The assuring aspect of purchasing one of the professional systems is that you know that you’re at par with the dealing room traders, who get the exact same information from the same providers. This might be important especially if you day-trade forex products.

Mini Forex Account

Mini forex accounts describe an account within a forex brokerage that allow the customer to participate in trading FX with fractional minimum account size to the “real” forex accounts.

The mini FX accounts are possible due to the fractional trading sizes, with one mini lot being a fraction of one actual lot in the interbank forex market.

This way, the margin requirement and account size can be fractional in size as well.

Trading with Mini Forex Accounts


Because the trades placed with mini FX accounts are placed outside of the interbank forex market (due to their size), the marketmaker for the mini trading lots is usually the same brokerage that you have the mini forex account with.

But, because the brokerage can hedge risk effectively in the interbank market, they can (usually) also offer comparative spreads and comparative market prices to the actual forex markets. 

However, you’ll find differences in rollover rates (rates paid to or subtracted from an account held overnight) that will affect your trading performance. Therefore, it usually pays off to compare mini FX accounts to find the best rates on overnight positions (in addition to the most competitive spreads).

Mini Forex Accounts – Providers

With Internet, the popularity of mini FX accounts has skyrocketed. In fact, many stock investors seem keen to spread their risk by taking positions on the forex market with mini FX trading accounts.

There are tens of providers available for mini FX accounts. These providers differ in, for example, overnight rates, trading spreads, and maximum leverage rules, so you should take your time comparing the offers.

In addition to comparing the mini forex accounts, compare the trading platforms available. There are huge differences in the ease of use and interface design between trading platforms. 

The choice of a platform may, in fact, affect your trading returns (you have to have the ability to use the platform correctly and quickly), so choose one that you’re comfortable with.

Learn Forex

Learning forex markets is traditionally part of the curriculum in most business schools. In addition, you can learn forex markets and currency trading in separate courses, seminars, from mentoring or by instructions from dealers and brokers. Books and forex magazines offer another way to introduce yourself to foreign exchange operations.

Many dealers in banks that handle foreign exchange operations have business school degrees (MBAs), or Master's degrees in quantitative subjects like finance or mathematics.

In fact, because currency trading is becoming more and more popular, many universities offer courses on forex markets as separate modules available to all (for a fee).

Therefore, if you're learning forex markets, your local university should be one of the first places to look at. 

Learning Forex – Courses



There are many classroom courses available to learning forex. These situations normally involve a group of people taught at the same time.


However, if you choose learning forex through courses of this kind, you’ll get better one-on-one feedback from the teaching staff than you would get from a seminar, where the audiences are bigger.

Furthermore, in relation to mentoring (one-on-on tutoring), forex courses offer a more inexpensive way to gain knowledge about the markets.

If you’d like to start learning forex through courses, here's a sample of companies offering them:

Market Traders Institute
Learn:Forex
Concorde Forex Group
Trader House Network
Euromoney Training Group
FinEdge

Learning Forex - Instruction


Instruction based forex learning is gaining popularity due to Internet. While the students paper trade, the educators give instructions on what was done correctly by the student and what was not.

Because much of the trading rules used and taught in courses and seminars is based on technical analysis, the teachers can give feedback on the correct use of the rules when the students use these rules on paper trading or at actual trading situations.

The education situation is very similar to mentoring, where feedback is given on one-on-one basis. However, with mentoring, the feedback normally goes much deeper, even into the psychology of trading, which is a very important aspect of the whole trading experience.

Learning Forex – Mentoring

Mentoring can be the most expensive, yet most beneficial forms of forex education. 

In forex mentoring, feedback is given one-to-one, and the teaching covers all bases of forex markets, including trading psychology, market analysis, and trading rules.

However, it’s very important to be picky about the mentor. Choose carefully a person with a successful trading background and a personality that you feel comfortable with.

If you’d like to start learning forex through mentoring, here are a few exemplary companies offering these courses:

Online Trading Academy
Learn4x
FX-Strategy


Learning Forex – Seminars

Seminars usually offer an affordable way to hear from the superstars of FX trading. What you normally won't get is a personalized experience, but instead will gain a peek at the trading strategies of the best.

There are also beginner’s seminars, where the basics of forex markets are covered. What you’ll love about these seminars, in addition to the basic material itself, is the Q&A session after the seminars, allowing you to ask and hear others ask questions about forex.

Some (bigger) seminar organizers allow you to purchase the handout materials without participating in the seminar itself, for a deeply discounted price. This is a preferable way to get the knowledge from a seminar if you don’t live nearby from where the seminar is held.

If you’d like to start learning forex by attending FX seminars, here are a few exemplary companies:

Deal4Free (CMS Group Plc)
InformForex (Inform Networks)
Euro Finance


Learning Forex – Magazines

To start learning about forex markets and trading, forex magazines offer up-to-date information on the most successful trading strategies, companies, and individuals. 

And because of the on-going development in FX trading systems, you’ll get to know about the latest offers from developers of these systems.

An upcoming trend among publishers is to publish on-line only magazines for forex professionals and enthusiasts. For example, e-Forex is devoted to on-line FX trading.

If you’d like to start learning forex from FX magazines, here are a few examples you might want to take a look at:

CONSENSUS National Futures and Financials Weekly
Derivatives Week (for FX derivatives traders)
e-Forex
FXWeek
Technical Analysis of Stocks & Commodities


Learning Forex – Books

For many, the first way to learn forex is through books. In fact, you can learn about all aspects of foreign exchange related operations, such as options, futures, currency swaps, euromoney markets and others from books.

Even though some books are about trading strategies in other financial markets, they can be used directly on forex trading. In fact, most books on technical analysis fall under this category.

However, if you use fundamental analysis, which deals more about the non-quantitative measures of forex markets, you should concentrate more on books with strict focus on forex markets.

There are hundreds of books available to start learning forex and currency trading. Here is a sample of the more popular ones, available through the bigger bookstores:

”Understanding the Euro” by Christian Chabot
”Trading the Fundamentals” by Michael Niemira and Gerald Zukowski
”Technical Analysis of the Futures Markets” by John Murphy
”What Drives Currency Markets” by Brian Kettell
”Trading in the Global Currency Markets” by Cornelius Luca
”An Introduction to Foreign Exchange & Money Markets” from the Reuters Financial Training series
”Currencies and Crises” by Chris Charlton

Learn The Trade

You can learn currency trading from several sources, including courses, books, and personal instruction (mentoring) programs.

Once you know how the foreign exchange markets work, you can apply several trading strategies to the forex markets (that work on many other markets as well).

In fact, many hedge fund managers, for example, diversify their portfolios to forex products from commodities and stocks to spread market risk. And they use the same or similar trading styles for each market.

To learn currency trading, books are usually the cheapest way, with currency trading courses and personal mentoring being much, much more expensive.

Learn Currency Trading – Books



There are several pros for learning currency trading from books. For the first, you can advance at your own pace. This makes it easier to learn currency trading at the same time that you have other pressing obligations.


Moreover, you can go as deep into the forex markets as you like, with all the macroeconomic elements as well as trading psychology taken into account. This way, you can customize your learning experiment to suit your personal needs, something that would cost mountains of money at taught courses.

In addition, many of the superstars of trading have published their trading strategies in books. So, instead of spending several thousand dollars on personal consultation, you can get the same info on a book format.

Below are some exemplary books that can help you learn currency trading.

's Biggest Market
By Philip Gotthelf



Currency Strategy: A Practitioner's Guide to Currency Trading, Hedging, and Forecasting
By Callum Henderson



Trading Currency Cross Rates
By Gary Klopfenstein

Learn Currency Trading – Courses


Many use forex courses to learn currency trading only after they have read the basics of currency trading in book form.

In addition, you might want to learn the basics of technical analysis before signing up for any of the courses, as technical analysis is used in most of the currency trading styles.

Classroom forex courses offer you firsthand experience on what trading is all about. To achieve this, many classroom courses have simulated trading platforms, where you have to think and behave as you would do in a live trading situation.

There are many companies offering trading courses. Here’s an exemplary sample of these firms:

Market Traders Institute
Learn:Forex
Concorde Forex Group
Trader House Network
Euromoney Training Group
FinEdge

Learn Currency Trading – Personal Training (Mentoring)


Use forex mentoring for the most comprehensive approach to Forex and currency trading. It’s best to use mentoring only after you’ve covered all the basics of foreign exchange markets and trading fundamentals.

Then, with a personal trainer with a successful track record in currency trading, you can deepen the acquired knowledge and get ready for big-time trading.

With the advice from an experienced trader you can shorten the learning curve and avoid commonly made mistakes in trading.

There are an increasing number of companies offering mentoring courses to learn currency trading. Here are a couple exemplary firms you might want to take a look at:

Learn:Forex
Concorde Forex Group

Forex Trading Solution

Forex trading solutions are sold in many forms, such as forex classes, books, and ready-made systems.

In fact, there are an increasing number of sellers willing to sell you a complete system, with the trading rules completely, partially on not at all revealed.

If the rules of the system are not revealed, the system is called a “black box” system, where you have to rely on the signals the system gives without knowing how they are generated.

Constructing a profitable system is not cheap and thus you’ll find many of the systems sold for $3,000+. However, despite the system being profitable in the past, nothing guarantees that any buyer will make any money with it in the future.

Forex Trading Solutions - Strategies



When purchasing a solution for forex trading, one of the first things you have to think about is the strategy that you want the system to use.


The major strategies in forex trading have to do with fundamental analysis and technical analysis.

With fundamental analysis, you make your own view as to where the markets are headed based on economic and other indicators. Or, you rely on fundamental analysis of a third party. Based on this view, you then make your trading calls.

As for technical analysis, you make your trading decisions on historical data (price, volatility etc.) of the forex currency pair. Technical analysis gives you signals whether you should be short or long of the currency pair or stay in the sidelines.

Fundamental analysis is much harder to teach of these two because it can place extraordinary weight on appearances and interpretation of situations. To assist in the analysis, many use a variety of econometric tools.

Some traders use a mix of the two, with fundamental analysis sometimes overruling the signals given by technical analysis.

You can purchase solutions for both of these approaches. There are many technical analysis solutions sold as PC software, books and taught in seminars and classes. As for fundamental analysis, possibilities are to look for good books on the subject or enroll in a mentoring program that teaches you to analyze the fundamental information.

Forex Trading Solutions - Techniques

Once you have a trading strategy in place, learning about trading techniques will show you how to place actual intraday trading calls, how to use market stops and other orders and how to choose the best forex dealer.

What techniques you use in placing trades can make a difference in your trading results. This is particularly true for day trading, where slippage (difference between intended trade price and actual price) can easily make otherwise feasible system useless.

You can learn techniques from trading books, seminars, and mentoring. In fact, mentoring is probably the best way to learn how to effectively make trades. However, mentoring is also the most expensive of the trading solutions to learn techniques.

Forex Trading Solutions - Systems


Forex trading systems are turnkey forex trading solutions. The system gives signals for the selected currency pairs and the profits and losses are made by following these signals.

There are many ways to purchase or subscribe to systems. Some companies offer subscriptions to trading signals via emails based on their system. Others let you buy their software, which is used with selected currency pair’s data to get the trading signals.

Some systems are sold with all of the trading rules revealed. Others will be sold as black box systems, where you just get trading signals, but no detailed information what triggers the signals.