Top 6 Forex Trading Facts For Beginners

The Market that never sleeps – this is how the Forex market is mostly referred to. It is very popular, especially for traders who are trying to earn out of paying a small deposit. In Forex trading, you can trade well-known currencies like U.S dollars, Euro, Japanese yen, UK pound, and more. But before you start a trade, you need to know the basic foundation of the Forex market. Check out these interesting facts.

It trades 5.3 trillion dollars per day

There is an average of 5.3 trillion worth of trading in the Forex market every day. Since the 1990s, this number has been increasing really fast, considering the entry of retail traders. Before, the forex market was ruled by huge banks and other financial institutions. But since Forex brokers paved the way for retail traders, the Forex market became even more popular.

4x volume of trades vs. the Global Gross Domestic Product

This is insanely true. The Forex market is 4x larger compared to the global gross domestic product. Now you know why you need to gain some knowledge first before entering your first trade.

170 countries participate in trading

There are more or less 170 countries in the Forex market nowadays. As a matter of fact, most of the currencies in the world can be traded in the market. There are so many currencies to choose from including the United States dollar, Japanese yen, Swiss Franc, Euro, Indian rupee, New Zealand dollar, and more. These currencies are grouped in three – the majors, the minors, and the exotic currencies. Those who use a Forex calculatorwill most likely achieve their daily goals.

85% of Traders only trade seven currency pairs

The highest volume of trades in the Forex market goes to the seven currencies including EUR/USD, USD/JPY, GBP/USD, AUD/USD, NZD/USD, USD/CAD, and USD/CHF. As you have noticed, all these currencies have USD with them. As a matter of fact, 90% of transactions in the Forex market involve a USD.

Forex trading is larger than NYSE

Trading stocks is popular and the same goes for bonds and commodities that are traded in the New York Stock Exchange (NYSE). But Forex trading is larger than the volume of trades on the NYSE. It is 53 times larger, to be precise.

5% of the overall volume is credited to retail traders

Everybody can join the market, something that isn’t possible back in the day. Previously, the Forex market was ruled by big financial institutions, banks, investment managers, hedge funds, multinational corporations, and more. But now, 5% of the population in the market are retail traders.

Forex Trading Tips

The biggest challenge for every new trader is the lack of knowledge about Forex and the inability to use a Forex calculator. The market is unforgiving and will surely pull you down on every chance they can get. Novice traders without much experience could suffer big time.

One of the major rules in the market is to always start small. By doing so, you can test the market without losing a lot. Of course, you cannot say that you won’t lose. What’s important is that your losses won’t overpower your gains. This way, you can remain steady in the market for a long time.