Trading Currency Blog

afridy asked:


What is the Ruling on Currency Trading (Forex) in Islam ?
Thank You for the answers friends,
ill choose the best answer also.

CROUT

Dino Dinero asked:


Forex trading is becoming more and more popular. More people are starting to trade in the forex market every day. One of the reasons for the gain in popularity, is the way that the internet has made forex trading convenient and accessible, with forex trading sites popping up all over the web.

Forex trading is the buying and selling of foreign currencies. Many see it as an alternative to stocks and mutual funds, since currencies are much more liquid than stocks. Companies that deal in forex trading for their investments, by buying foreign currencies will have those currencies available if they decide to expand into foreign markets. Another advantage that forex has over stocks is that the trading window is much larger. Stocks are bought and sold only when the stock market is open. Forex may be traded 24 hours a day, Monday through Friday.

The forex market offers different types of forex trading. These different types of trading may seem very similar to each other, but they are in fact different. Each type of trading has its advantages and disadvantages. If you plan on entering the forex market, you should know the differences.

Traditional forex trading one of the common methods. Traditional trading involves buying a currency at a low rate, and then either selling it for a higher price, or exchanging it for another currency when the exchange rates rise.

Spread betting is probably the most common type of trading, even though it differs from the way that forex trading is normally done. It does not involve buying or selling currencies as in the traditional method. Spread betting involves betting on whether a currency will appreciate or depreciate. Despite the image of gambling, many people feel that this method is a good way to earn money in forex market.

Day trading is a notorious type of forex trading. Similar to day trading in the stock market, this method involves buying and selling currencies for one day, rather than holding on to them and waiting for them to appreciate in value. This type of trading can be risky, but can also yield some good results. Because of the risk, however, many experts do not get involved in this style of trading.

Auto trading is an automatic trading system, as you may probably guess from the name. With this method, an investor will invest in a platform that will automatically execute trades depending on its anaylyis. In this style of trading, the investor can save money since there are no commission and transaction fees. Some people, though, are not comfortble letting a computer handle the trading. They are more comfortable doing the trading themselves.

As with any investment, there is some risk. If you know what you’re doing, however, there are much lower risks in forex trading than investing in the stock market. Before you get involved in trading currencies, read up on the market. Know how the trading is done, and what signals to watch for. Knowing forex trading, and knowing the signals will help to minimize the risks of investing.



CANCIO

Daniel Church asked:


Forex market trading is trading currencies worldwide. Just about every country in the world are involved in the forex trading markets, where money is bought and sold, based on the value of that currency at the particular time. As some currencies are not so strong, it is not going to be traded heavily, as the currency is stronger and worth more, more investors and traders are going flock to invest in that market at that particular time.

Forex trading takes place twenty four hours every day, where about two trillion dollars exchange hands every day. That amount of money eclipses other investment markets such as the stock markets and the futures markets. For example, the US stock market trades about 200 billion dollars everyday, while the commodities markets trade over 400 billion dollars each day. These figures give a good picture of how large and liquid the forex market is.

The currencies that are traded on the forex markets are from countries all over the world, though most of the investors’ trade on a few major currencies such as the US Dollar, Euro, the British Pound, the Japanese Yen, the Swiss Franc, as well as the Australian and Canadian Dollars. Every currency has it own three-letter symbol that will represent the particular currency that is being traded. For example, the Japanese Yen will be shown as JPY, the United States Dollar will be shown as USD, the Euro is EUR, and the British Pound will be displayed as GBP, while the Swiss France will show as CHF. You can trade among many currency pairs in one day, or you can just trade only one currency pair. The advantage of trading forex is there is not that much currency pairs to keep track of. Compare it to the stock market where there are thousands of different companies that offer their stocks in the market. Trying to research even a small number of all the companies listed will take a very long time.

Getting started in forex trading is not hard. In fact, setting up a forex trading account costs less than setting up say, a stock trading account. Many forex market makers allow individuals to create a trading account for only $300. The reason this is possible is because forex trading involves a lot of leverage, more leverage than other investment markets. The leverage can start at 100:1 and can get as high as 400:1. This means you can control a large amount of currency with a smaller capital outlay. For example, in a 100:1 leverage, you can trade $10,000 amount of currency using only $100. Though it needs to be reminded that though the use of leverage can generate high returns, it also means that it can cause spectacular losses. What’s more important that minimum account size, however, is to get educated in forex trading, such as learning technical trading tactics and keeping track of forex news.

Another advantage in trading forex, and a very important one at that, is the absence of brokerage fees. Over time, this will save you a lot of money, especially having in mind that forex trades are executed regularly. All said, forex trading provides a proven method of making huge profits, as long as you keep an eye on the pitfalls and get yourself educated.



BERNARD