A lucrative market called FOREX

The Foreign Exchange Market, also known as the FOREX market, is more lucrative than any other investment market since this market is the largest in terms of total cash volume traded. With an estimated daily turnover of $1.9 trillion, the FOREX market is something that future investors should reckon with.

The demand for FOREX is almost inexhaustible since currencies such as the US dollar (USD), British Pound (GBP), Euro (EUR), and the Yen (JPY) and many others are in constant fluctuation. According to the Wall Street Journal, the FOREX market almost doubled from $1 trillion to $1.9 trillion in just a span of 10 years, in comparison, the market was just by $70 billion in the 1980's.

FOREX works by the simultaneous buying and selling of currency to another and it works around the fact that the value of currencies is not static but liquid. Simply put, FOREX is making money out of money itself.

For easier illustration, suppose that the value of the USD is 1.4 and the EUR had 1, meaning that Euros are cheaper than dollars by a margin of 0.4, however, current market indications points out that the EUR would eventually gain an upper hand against the USD in the near future, and you bought EUR 140,000 while simultaneously selling USD 100,000, and then wait for the Euro to increase its value. As you anticipated, the value of the EUR increased over the USD, it is now 1 EUR = 1.4 USD. Now, to profit from the exchange, you resell your EUR 140,000 while simultaneously buying USD 196,000 pocketing a whopping total profit of USD 96,000.

Of course, the real-time value of the currencies to be exchanged is far from the example above, it still points out that money can be made easy by buying and selling money itself. With carefully planned moves and good sense for market trends, an investor can make a fortune out of the FOREX market.

The introduction of the Internet to the market substantially increased the liquidity of the FOREX market since it allowed an unrestricted volume of money to be transferred across borders instantly; hundred of millions in various currencies are traded within a matter of minutes. The Internet also allowed the market to run 24-hours a day, making trading across the American, European, and Asian time zones unrestricted and allowing investors to react to currency fluctuations fast.

Because of the Internet and the wealth of information that it brought, many investors jumped on the chance that the FOREX market delivers. The Internet allowed these small-time investors to be up-to-date about the current market trends, currency value, and market risks, making FOREX safer to an extent compared to other investment markets.