Are you a forex trading beginner? The term may sound like an oxymoron. It stands for foreign exchange, and I can tell you that it's not an easy game to play with. Many people have given up on this opportunity despite the promising rewards it dangles because of the seeming inaccessibility of its system.
But let me tell you that it's very possible to become a good trader in this $2 trillion industry even if you are a beginner. Let's review three different methods of trading...
Method No. 1: Trading Through A Broker
A broker is a middleman who brings investors together so that they can trade the currencies they want to trade.
Unlike other investment markets, however, brokers in the foreign currency exchange industry don't work for themselves, they work for banks. These brokers are tasked with the duty of bringing together investors from all over the world so that they can trade currency at optimal values and without violating any existing laws.
Method No. 2: Direct Trading
Some people would rather trade directly with a party they have found rather than coursing the entire deal through a middleman. Though this may seem like an easier route to take, it is not really advisable for beginner forex trading.
Method No. 3: Matchmaking System
Whereas the first two foreign currency trading methods require one on one trading, that is, you and another party, using a matchmaking system will have you trade against the entire market. A matchmaking system operates on anonymity.
Of course, though this may seem like the perfect system for beginner forex trading, anonymity carries more risks. Would you really want to trade large amounts with someone you don't know, in a manner that is not really regulated?
As a beginner forex trading method, using a matchmaking system is a good entry level strategy only if you will be dealing with small amounts. Use this at first until you learn the ropes.
