ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

What is Online Forex Trading.

Updated on October 28, 2009

Forex trading definition

Forex Trading Definitions

Welcome to the second hub of Online Forex Trading Basic, if you missed the previous article on you can have access through this link Why Forex Trading? Which we discussed the benefits of trading currency

Forex – This is the Foreign Exchange Market where investor trade currencies, as a forex trader you have the ability to trade in different foreign currencies like EUR, USD, AUD, CHF and many more. What happens in forex exchange is the simultaneous buying of one currency and selling of another, here is what happens in forex market EUR/JPY. As we have said you buy one currency while at the same time selling the other. Assuming you are executing a buy order on the paired currencies above, you will be buying EUR while at the same time selling JPY. Assuming you will be executing a Sell order, you will be Selling EUR while at the same time buying JPY

Over The Counter Trading

OTC – Over The Counter, forex market is referred to as OTC because it has neither physical location; forex market is run electronically with so many banks and also known as interbank market

Currencies Traded and their Symbols

Country                          Symbol                    Currency

Australia                          AUD                       Dollar

Canada                          CAD                        Dollar

Switzerland                     CHF                        Franc

Euro Countries              EUR                         Euro

Great Britain                 GBP                         Pound

Japan                           JPY                           Yen

New Zealand                NZD                          Dollar

Those are some of the major currencies traded on the Forex Market, there are many small currencies that one can trade with other than the above mentioned one

Long/Short – in Forex Market you are either going long, which means you are buying a base currency while selling quote currency. While going short you selling the base currency while buying the quote currency

Base/Quote Currencies – The base currency is the first currency in any traded pairs while the quote currency is the second currency in any traded pairs. EUR/USD – Here the base currency is the EUR while the Quote currency is USD

Bid/Ask – The bid is the price at which you will sell a base currency. While Ask is the price at which you will buy a base currency

Pip – Refers to an increment in the currencies prices. If AUD/NZD is 1.0056 to 1.0060, the increment that occurs in that last decimal place is 4

Lots – Currency are traded in sizes known as lot, the standard lot size is 1, with other small lot sizes like 0.01, 0.02, 0.05, the bigger lot you traded the higher profit chances and the higher the risk

Margin call – When your broker feels that your account is almost being wiped out, they will automatically closed all opening position and at the same time sent you alert message, this is normally known as margin call. Brokers does this to protect themselves from incurring loses also

Those are some of the Basic definitions that Forex Traders need to know before getting involved with currency trading. Our next hub/article which is accessible through this link will be on Types of Forex Order Types

Comments

    0 of 8192 characters used
    Post Comment

    No comments yet.

    working

    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://hubpages.com/privacy-policy#gdpr

    Show Details
    Necessary
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
    Features
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Marketing
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Statistics
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)