You will need only a few hundred dollars to set up a trading account with brokerage firms such as Juno Market, a leading Asia Forex Broker. This trading account will give you access to more funds for trading purposes. The broker will not charge commissions because they will earn their money on the spreads, which are the difference on the offering and asking prices in transactions. The difference in the offering and asking prices are termed as the bid-offer spread, or bid-ask or buy-sell spread in foreign exchange lingo. The bid price is the price at which your broker will buy the base currency with quote currency, and the price at which you will sell your quote currency. The ask price is the price at which your broker will sell the base currency with the quote currency, and the price at which you will buy.
The changes or fluctuations in currency rates are very small, usually less than one percent of the value of the currency. So currency traders resort to using leverage to increase the value of the transactions. Leverage in foreign exchange market is a method of getting control of a large amount of money, with only a small deposit. Leverage in effect is borrowing money from the broker. If the broker offers a 100:1 leverage, then the trader can trade $100 for every $1 in his account.
Playing it safe
Because you are a relative newcomer, concentrate on a few currency pairs because trading in too many markets can cause you to lose focus and get confused or impulsive, a recipe for disaster. When things start to go wrong, you should know when to stop. The means of doing this is the stop loss order to your broker. It is an order to your broker to buy or sell when the price of a currency hit a pre-defined price. This pre-defined price is the stop price in foreign exchange trading. One of the better ways of preparing to trade forex money for profit and avoid losses is by practicing in a demo accounts. Juno Market has an demo account option too. Demonstration accounts use virtual money which you can use to place make-believe trades. The demo accounts will let you test and evaluate several trading strategies, practice trading on margin with practice money, how to calculate profit and loss. The usual demo account will be open for 30 days, during which you can practice trading with live prices and spread in real market conditions.
The fact of the matter is that currency trading isn’t suitable for everyone. You need a trusted broker and if you are looking for Asia Forex Platform, Juno Market should be your first choice as they are the best. They were awarded the best Forex Broker for 2018 in China. You can read the Juno Market review to see why they are the best choice. Trading requires focus and keeping tab of the movements of rates, as well as keeping a watchful eye on market-moving forces and developments in the economic climate. Even professional traders find it hard to keep track of all things that are happening at the foreign exchange market at all times. What is clear is that foreign exchange investment is risky and the investor should understand the risks and the means of mitigating it.