How to Earn From Forex

People all over the world earn from forex every day, with over 3 trillion dollars traded it is no wonder that some people are quietly getting rich from the comfort of their homes. So the big question is how it does work and how do I earn from forex? In this article I am going to look at how forex trading works and where to look to get started.

Forex trading is the buying and selling of one currency against the other, for example, the GBP/USD. This is known as a currency pair; the Great British Pound V's The United States Dollar. Trading on the foreign currency market is known as speculating, but for the simplicity of this article I am going to use the term "bet". The idea of the currency market is different from the foreign exchange booths you get in your local travel agent. You would not expect to be able to go and buy 100 dollars worth of Sterling then take it back 1 hour later and sell it back for a profit. On the forex market you can make 100's in profit in minutes.

So, how to earn from forex? You place a bet on the value of a currency going up in value or down in value against its second paired currency, for example, if you where to buy the GBP/USD or bet on this currency pair going up, you would be betting on the GBP increasing in value against the USD. You are actually betting on the last two decimal places in a currency pair in this case a tenth of a cent. If your bet was to the value of £1 a pip (a pip being a single point of the last two decimal places) and the currency increased in value by 10 pips you would make £10.

To explain this easier I am going to use a literal example; you buy the GBP/USD at 15000 or $1.50 to the Pound. The GBP increases in value to the price 15010 you have made £10 profit even though the USD is still only worth $1.5010 to the Pound It has increased 1 tenth of a cent. If you where to bet £10 a pip, this move would be worth £100. These currency pairs move hundreds of pips a day so you can see the potential.

To get started in the forex market I recommend getting some training, it is a very volatile financial market and is known for its unpredictability. One of the best and affordable ways of learning forex trading and earning whilst you learn is to join a forex club. Forex clubs are coordinated by a professional whose costs are shared amongst its members, in many cases you can trade live with the professional over a webinar and copy the trades that he does.