When I first got into forex trading 5 years ago, I was just like any other newbie. I had messed with stock market day trading a little and was attracted to the market because of its high yield potential. I had heard stories of many folks making 50% per month ROI and of course, like any other person looking to make money, I thought that this would be a perfect option to build cash quick. Of course, I was aware of the risks but I didn't take into account all the hidden dangers of forex trading. I didn't realize that forex trading has its own set of rules and that if you don't understand them, then you could easily suffer a margin call. The first time Rajibuddin Mandal, a family doctor in Birmingham, England, tried his hand at trading currencies online, he lost 2,000 British pounds. From that experience, he concluded that the foreign-exchange market was too big, too complex and too hazardous for amateur investors like himself. He decided he needed help from the professionals.
Yes, you can go out right now and open an account with a Forex broker, deposit some funds and then start trading Forex in five minutes. If you've traded Forex before, you'll appreciate that it's not something that you can master overnight. Sure, you may have put on a few brilliant trades last night, but unless you're some kind of market wizard prodigy (and we all have kidded ourselves that we are at some time or the other), you won't be making money with Forex consistently in the long run without a lot of time and experience in the markets.
To position Buy 3 lots USD/GBP, the transaction volume is 300,000 USD. Considering that for a USD 100,000 transaction size commission is charged for both opening and closing the position at USD 5 each, for this transaction it will be: 2 x (5 x 300,000 / 100,000) = 30 USD. The commission fee is deducted from the account during the opening of the transaction for both the operations at once (opening and closing).
The data from Bank for international Settlements shows the estimated turnover from foreign exchange markets global to be $3.98 trillion on a daily basis, as at April 2010. However, specialist firms on Forex foreign exchange came up with US$4 trillion as the average daily turnover from foreign exchange markets global.
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