For many decades, the foreign currency market was the domain of large players like national banks and multinational corporations. New rules in the 1980s allowed for smaller investors to access the FXCM Markets by opening a margin trading account. In layman’s terms, Getting Into The Lucrative World Of Forex Trading Articles margin accounts allow you to trade more money in your account than what you have. With a 100 to 1 margin account, you can trade as much as $100,000 for only $1,000.
Forex trading can be risky and not for the faint-hearted. This is why any beginner trader must first study and understand the Foreign Exchange Markets before risking any money.
The newcomer must also find a reliable broker, as trading is only possible through brokers. In this case, a personal referral is usually the most reliable, however, if that’s not possible, it is best to choose a futures commission merchant (FCM) who has been registered by the Commodity Futures Trading Commission. It will protect you from both fraudulent and abusive business practices.
You can open an account at a broker very easily. After you do this and add funds to your account, you are ready to trade. Brokers offer several accounts for different clients. Many of them have “mini accounts” that allow traders to get started with $250. Margin requirements vary between accounts.
You should look at the broker’s ability to simulate or do paper trades over a certain period. It is something that many brokers provide. You can trade as normal, but on paper. No money will be exchanged until you find your footing. Most online brokers allow for paper trading to be done free of charge up to 30 day.