how do forex trading worksExample trades are a useful way to learn the process of forex trading. Our forex trading examples show the opening and closing of a trade position, and how to calculate the accompanied profit associated with the trade. If traders feel a currency is heading in a particular way, they will trade accordingly and may persuade others to do the same, boosting or reducing demand. Stockbrokers provide leverage to forex traders to trade on margin, which allows traders to borrow funds from the stockbrokers to invest a higher amount in currency pairs. Leverage is presented in the form of ratios such as 50:1 or 100:1. For example, if your stockbroker provides leverage at 50:1, it means that if you put up Rs. 1,000, you can buy currency pairs amounting to Rs. 50,000 (50 times). However, trading on leverage is risky and can result in a margin call where you have to deposit additional money in case of losses.
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