1.Is Forex a Fair Market?
Foreign exchange is considered to be the fairest and most transparent market in the world. The main reason is that due to the large number of market participants, the huge scale and the number of transactions, no single country or bank can fully control the direction of the currency.
2. How can I make money through foreign exchange trading?
The way to make money is generally to buy low and sell high or sell high and buy low. Since we provide leverage, you can participate in the foreign exchange market with less money and earn more profits.
3. How should I control risks in foreign exchange trading?
There are many risk management strategies to control risk in foreign exchange trading. The most commonly used of these are stop loss and effective leverage. Stop loss can be set directly on the MT4 platform to avoid a wide range of risks by setting a loss that you can bear. In foreign exchange trading, effective leverage refers to the ratio of trading positions to trading funds. If the total trading capital is 10,000 and the trading position is 100,000, then the effective leverage is 10:1. In foreign exchange trading, many traders with small funds are inexperienced. They like to set their effective leverage very high, which may lead to huge losses in their trading accounts. Therefore, lowering the effective leverage can control the transaction risk accordingly.
4. Who are the main participants in the foreign exchange market?
Participants in the foreign exchange market are mainly central banks, commercial banks and investment banks, but in recent years, due to the impact of the development of the Internet on the foreign exchange market, the number of participants has greatly increased. Participants in foreign exchange transactions now include large multinational companies, fund managers, registered dealers, currency brokerage companies and private investors.
5. How can I trade online?
Anyone can conduct transactions anywhere in the world through the Internet. MT4 is a universal platform. Once you have downloaded and installed the platform, you can see the quotation window on the platform and click on the transaction. At the same time, you can also conduct transactions through mobile devices such as mobile phones and tablets.
6. What does spread mean?
In foreign exchange trading, you will see a two-sided quote, which consists of a buying price (ask) and a selling price (bid). The bid price represents the price at which you can buy the base currency (while selling the non-base currency); the ask price represents the price at which you can sell the base currency (while buying the non-base currency). The difference between the buying price and the selling price is the spread, and traders make profits through the spread of buying and selling.
7. What is Take Profit and Stop Loss
After you trade foreign exchange, you will come across the words Take Profit (stop profit) and Stop Loss (stop loss), both of which are tools used to control risks.
Take Profit: Lock the profit when the order reaches the expected profit price. When the order is profitable, the market suddenly reverses, and the profit will become less and less, and eventually it will be lost. Therefore, in order to maximize the profit of the order, or believe that the order can reach a certain price, you can set a stop profit on the open order at this time, then when the actual price reaches your limit price, it will become a market order. Complete the liquidation and lock in your profits. Take profit guarantees the price at all times, but does not guarantee the transaction. Once the take profit is completed, it will definitely be completed at the price you set.
Stop Loss: For the orders that have already been opened, the stop loss can control the range of the order loss. Set a price that is opposite to the predicted direction, and when the market price reaches this price, the position will be automatically closed. Generally, it is often used for misjudgment of trends, and stop loss can avoid loss expansion.
For example: you open a long position on the European and American currency pair EURUSD when the price is 1.05000, and you also set a take profit at 1.06000. When the actual price reaches 1.06000, your order will be automatically closed and a profit of 1,000 will be locked point.
You have set a stop loss at 1.04000 for your long order of the European and American currency pair EURUSD. When the actual price reaches 1.04000, the stop loss will be automatically closed. The purpose of setting a stop loss is to prevent greater losses, such as falling below a support level and then continuing to plummet. Please note that the stop loss only guarantees the transaction, but does not guarantee the price when the market fluctuates greatly.
