Have you ever traveled to another country, and needed to exchange the currency of your home country to that of the country you were in?
Well, that’s forex.
Forex stands for foreign exchange, and it is the process of changing one currency into another. It can be for a number of reasons, typically:
This also happens when you buy goods from other countries.
You may not see it directly, but somewhere along the line of making that iPhone in factories in China, to you picking it up at an Apple store, currency was exchanged between two foreign countries.
In this process of exchanging currency on your vacation, you may have noticed that the two currencies were not equal. This is because currencies from different countries often have different values
For example, currently, one US dollar is worth .76 of one pound. This means that one pound is worth more than one dollar.
That is why there is something called an exchange rate, or the value of one currency in relation to another. That way, when currency is exchanged, it is exchanged equally.
So if you wanted you get £76, you would need to pay $100 for it.
The value of currency in countries are constantly changing due to supply in demand, and because of this, there is forex investing.
What is forex investing
Forex investing is similar to investing in stocks, but instead, you are investing in another countries currency.
Essentially, you buy a ton of foreign currency, wait for the value of your home or foreign currency to move either up or down, and then make a profit by converting back to your home currency.
So, for example, let’s say you have £76, and you exchange that at the current rate for $100.
Then, the value of the US dollar increases, so that the exchange rate becomes $1 for £.86. You can then convert the US dollars you bought, back to pounds, meaning you will get back £86 for the $100 you had.
You have now earned £10 from forex investing!
Now this was a very simple explanation of forex investing.
In reality, it is a lot more complicated than that. There is a lot to know in terms of studying foreign currency, value trends and exchange rates.
Forex investing is also pretty risky because the value of money is constantly changing at different rates and in opposite directions depending on the country.
This makes predicting the future value of currency very difficult, way more so than predicting the value of stocks.
BUT, investing in forex can be very profitable.
If forex investing is something you are considering, it may be worth consulting with professionals.
Benefits of consulting with forex professionals
An investment agency will have employees with tons of experience and knowledge in smart investing. They will also know tons of strategies that can help you.
They will be able to help you do the research and make recommendations so you can make the most out of your money.
When looking for help from professional investors, make sure they offer services to help with forex investing.
One example of a company that does this is Pearl Lemon Invest.
They have a team of people who are extremely passionate about forex trading and care about helping you make money. They also will help you use forex robot trading, which is programmed software that automates trades.
So, if you’re looking to get involved with forex trading for the first time, it is highly recommended that you consult with professional forex agencies that have the above qualities.