Forex stands for foreign exchange trading. This form of investment deals with buying world currencies and selling world currencies. In a volatile market, a forex investor can make a wealth of money in just one day on the market if they understand the forex models. First, the investor must understand the basics and that includes setting up a forex account.
Understanding the Three Forex Accounts
The three forex accounts include a standard account, mini account and managed account. Each account has benefits and risks, but that is the same across the investing board, right? To quickly cover each account type:
- Standard Forex Accounts – This account the most common forex account. This account works on a 100 to 1 ratio with investors needing $1,000 to invest for every $100,000 of currency.
- Mini Forex Accounts – The mini forex trading account simply allows the forex investor to buy currencies in lots of $10,000 instead of $100,000; 1/10 of the standard forex account amount.
- Managed Forex Accounts – The managed forex account hands over the investing reigns to a third party. These buying and selling are chosen by another investor but the profits all belong to the owner of the account.
Setting Up the Forex Trading Account
Once you have decided on which type of account to invest in, the forex account world is open for you to make tons of profit. All you need to do is contact a reputable broker and fulfill the requirements of the brokerage firm. Remember, forex trading can be a high risk investment, but with high risk comes a higher rate of return for those who know where to invest their forex trading money.