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REASONS TO JOIN FOREX

Trade on spreads as low as 1-2 pips, commission-free  Trade currencies and spot gold at FOREX.com. Dealing spreads are as low as 1-2 pips on the most widely traded currency pairs. As always, you pay no commissions at FOREX.com, only the bid/offer spread. And with our fractional pips, you gain an extra digit of precision so that you can take advantage of smaller price movements.  Plus, you can enter orders at any price - even inside the spread - and trade around news events, major economic announcements and other times of high market volatility. 

Fully automated click & deal trading, with instantaneous fills  At FOREX.com, we've always automated processing for all click & deal forex trades. When you click BUY or SELL, our systems perform a real time margin check and, if accepted, immediately respond with a trade confirmation. 

Why is this important to you? First, you benefit from an unbiased trading environment that is not subject to human intervention. Second, automated trade processing improves our efficiency, which lowers our overhead and allows us to pass along the saving to you in the form of tighter spreads 

Flexible account types and leverage  » Standard accounts, with a default lot size of 100K and leverage⁺ of 100:1 (1%), are well suited for active forex traders.  » Mini accounts feature smaller, 10k contract sizes and leverage⁺ of up to 200:1. For traders new to the forex market, a mini account is a great way to get started trading in a live environment

Award-winning forex trading platform  We pioneered our signature "one-click" dealing in 2000 and have been nominated as Best Forex Brokerage by the readers of Technical Analysis of Stocks and Commodities for the past two years.  Our proprietary trading platform, FOREXTrader, successfully combines ease-of-use with remarkable flexibility. FOREXTrader offers a highly intuitive user interface, advanced customization features, and a full suite of professional charting and order management tools

Advanced tools & research  As a FOREX.com client, you'll have access to a variety of resources and unique trading tools that can help you make more informed trading decisions. 

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Full suite of daily and weekly forex research. Whether you're interested in fundamental analysis or technical trading methods, you'll have access to a wide variety of institutional-grade Forex market analysis as a FOREX.com client. And, tune in to our Weekly Market Call for timely trading ideas and analysis from Brian Dolan, our Chief Currency Strategist.

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ForexInsider streaming market commentary: Our exclusiveFOREXInsider delivers actionable analysis of news, events and technical levels that impact currency prices, in real-time, to your trading platform. Updates are published as often as 20 times an hour, so that you can act instantly on new market intelligence Guaranteed fills on stop loss and limit orders  During FOREX.com's trading hours, all stop and limit orders up to $2 million are guaranteed to be filled at your price.  We understand that stop loss and limit orders are an important part of every trader's risk management strategy, and so we take this policy very seriously. This policy does not apply during major fundamental announcements, or outside FOREX.com's normal trading hours Negative account balance protection  At FOREX.com, your risk is only limited to funds on deposit.  Our margin policy eliminates concerns about debit balances by guaranteeing that you will never owe more than you have in your account

New to the Forex market?

Step 1: Understand the FOREX market.  Dive into Forex 101 for a compact overview of the basics or sit back and join us at one of our live interactivewebinars.

Step 2: Prepare to trade in a live environment.  Register for one of our training courses and study at your own pace or join us at a local workshop, where our experienced instructors can teach you in a dynamic classroom setting.

Step 3: Test your skills risk free.  Sharpen your technical analysis techniques with a free 30 day practice account. 

What's Forex?  "Forex" stands for foreign exchange; it's also known as FX. In a forex trade, you buy one currency while simultaneously selling another - that is, you're exchanging the sold currency for the one you're buying. The foreign exchange market is an over-the-counter market.  Currencies trade in pairs, like the Euro-US Dollar (EUR/USD) or US Dollar / Japanese Yen (USD/JPY). Unlike stocks or futures, there's no centralized exchange for forex. All transactions happen via phone or electronic network.  Who trades currencies, and why?  Daily turnover in the world's currencies comes from two sources:

• Foreign trade (5%). Companies buy and sell products in foreign countries, plus convert profits from foreign sales into domestic currency. 
• Speculation for profit (95%).

Most traders focus on the biggest, most liquid currency pairs. "The Majors" include US Dollar, Japanese Yen, Euro, British Pound, Swiss Franc, Canadian Dollar and Australian Dollar. In fact, more than 85% of daily forex trading happens in the major currency pairs.  The world's most traded market, trading 24 hours a day  With average daily turnover of US$3.2 trillion, forex is the most traded market in the world. A true 24-hour market from Sunday 5 PM ET to Friday 5 PM ET, forex trading begins in Sydney, and moves around the globe as the business day begins, first to Tokyo, London, and New York.  Unlike other financial markets, investors can respond immediately to currency fluctuations, whenever they occur - day or night.

More Info  "All About the Foreign Exchange Markets in the United States", from the Federal Reserve Bank of New York.

Understanding Forex Quotes  Reading a foreign exchange quote is simple if you remember two things:

1. The first currency listed is the base currency
2. The value of the base currency is always 1.

As the centerpiece of the forex market, the US dollar is usually considered the base currency for quotes. When the base currency is USD, think of the quote as telling you what a US dollar is worth in that other currency.  When USD is the base currency and the quote goes up, that means USD has strengthened in value and the other currency has weakened. Rising quotes mean a US dollar can now buy more of the other currency than before.  Majors not based on the US dollar  The three exceptions to this rule are the British pound (GBP), the Australian dollar (AUD) and the Euro (EUR). For these pairs, where USD is not the base currency, a rising quote means the US dollar is weakening and buys less of the other currency than before.  In other words, if a currency quote goes higher, the base currency is getting stronger. A lower quote means the base currency is weakening.  Cross currencies  Currency pairs that don't involve USD at all are called cross currencies, but the premise is the same.  Bids, asks and the spread  Just like other markets, forex quotes consist of two sides, the bid and the ask:  The BID is the price at which you can SELL base currency. The ASK is the price at which you can BUY base currency.  What's a pip?  Forex prices are often so liquid, they're quoted in tiny increments called pips, or "percentage in point". A pip refers to the fourth decimal point out, or 1/100th of 1%.  For Japanese yen, pips refer to the second decimal point. This is the only exception among the major currencies. 

Leverage & Margin  Leverage trading, or trading on margin, means you aren't required to put up the full value of the position.  Forex trading offers more leverage than stocks or futures - up to 200 times the value of your account. Of course keep in mind that increased leverage also increases your risk.  FOREX.com: No debit balances, no margin calls  At FOREX.com, your risk is only limited to funds on deposit. There are no margin calls in forex trading, so if your account falls below required levels, for your protection we will close out all positions automatically. You'll never lose more money than you have in your account.  More leverage means more opportunity - and more risk  It's crucial to remember: increasing leverage increases risk. To limit downside risk, monitor your account regularly and use stop-loss orders on every open position. 

Calculating Profit and Loss

For ease of use, most online trading platforms automatically calculate the P&L of a traders' open positions. However, it is useful to understand how this calculation is formulated:

To illustrate an FX trade, consider the following two examples.

Let's say that the current bid/ask for EUR/USD is 1.4616⁰/19⁰, meaning you can buy 1 euro for 1.4619⁰ or sell 1 euro for 1.4616⁰.  Suppose you decide that the Euro is undervalued against the US dollar. To execute this strategy, you would buy Euros (simultaneously selling dollars), and then wait for the exchange rate to rise.  So you make the trade: to buy 100,000 Euros you pay 146,190 dollars (100,000 x 1.4619⁰). Remember, at 1% margin, your initial margin deposit would be approximately $1,461 for this trade.  As you expected, Euro strengthens to 1.4623⁰/26⁰. Now, to realize your profits, you sell 100,000 Euros at the current rate of 1.4623⁰, and receive $146,230  You bought 100k Euros at 1.4619⁰, paying $146,190. Then you sold 100k Euros at 1.4623⁰, receiving $146,230. That's a difference of 4 pips, or in dollar terms ($146,190 - 146,230 = $40).  Total profit = US $40.  Now in the example, let's say that we once again buy EUR/USD when trading at 1.4616⁰/19⁰. You buy 100,000 Euros you pay 146,190 dollars (100,000 x 1.4619⁰).  However, Euro weakens to 1.46110/140. Now, to minimize your loses to sell 100,000 Euros at 1.4611⁰ and receive $146,110.  You bought 100k Euros at 1.4619⁰, paying $146,190. You sold 100k Euros at 1.4611⁰, receiving $146,110. That's a difference of 8 pips, or in dollar terms ($146,190 - $146,110 = $80).  Total loss = US $80.