The Most Useful Forex Facts
The most famous and largest stock market in the world is Forex, which has a huge number of investors. Well, it is worth noting that it is possible to trade only through a broker, since the market entry amount will not be accessible to the person. Successful trading in the market requires patience and hard work with high-level analytical thinking. To make money in the forex market, you need to understand the basics of trading.
Forex is one of the biggest markets in the world. A successful trade requires calm, hard work, patience and analytical skills. To predict the market situation, a professional Forex trader analyzes the growth of stocks and their fall, and follows the movement of certain currency pairs. For this purpose, it applies two types of analysis, technical and fundamental. A fundamental helps a trader consider the political and economic environment, the degree of inflation, the unemployment rate, and many other factors. The beginnings of the Forex market date back to the 1970s, a time when the gold standard no longer met the demands of today’s global economy. Heads of state at the time had to replace fixed exchange rate agreements backed by a gold standard with floating rates.
Technical analysis is performed on the history of a certain financial asset – its growth and decline. It is useful to know some interesting Forex facts about this market:
- Almost 100% of participants in this market lose the first deposit. Psychologists believe that a trader playing demo scores is colder than a real one.
- Forex is the largest stock market in the world.
- Each month, 9 to 20 transactions are opened by 41% of traders on average.
- A large deposit size is not a guarantee of success in Forex. The ability to trade is the only real guarantee of success with a positive result.
- The concept of the Forex market dates back to the official abolition of the gold standard.
- According to statistics, only about 5% of traders continue to trade Forex after losing their first deposit.
- Fluctuations in exchange rates became directly dependent on demand and supply, so currency conversion became free, rates — floating.
- The most popular currency in the forex market is the US dollar, which powers over 88% of transactions worldwide.
- The major global Forex trading centers are Tokyo, New York, Sydney, Frankfurt and London.
As at present, trading in the foreign exchange market was marginal and was done through borrowed funds. A little later, margin requirements were simplified, which led to the entry of new participants: private traders, trading centers and brokerage firms. Brokerage firms remain intermediaries for individual traders, giving them access to trade.