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Home » FAQ » How Does Forex Trading Work?

How Does Forex Trading Work?

Forex trading is in essence trading currencies for one another. As such, an XM client sells one currency against another at a current market rate.

In order to be able to trade, it is required to open an account and hold currency A and then exchange currency A for currency B either for a long term or a short-term trade, with the ultimate goal varying accordingly.

Since FX trading is performed on currency pairs (i.e. the quotation of the relative value of one currency unit against another currency unit), in which the first currency is the so-called base currency, while the second currency is called the quote currency.

For example, the quotation EUR/USD 1.2345 is the price of the euro expressed in US dollars, which means that 1 euro equals 1.2345 US dollars.

Currency trading can be carried out 24 hours a day, from 22.00 GMT on Sunday until 22.00 GMT on Friday, with currencies traded among the major financial centers of London, New York, Tokyo, Zürich, Frankfurt, Paris, Sydney, Singapore and Hong Kong.

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AAFXTrading Company LTD is one of the world’s fastest growing Forex & CFD provider.The company offers Foreign Exchange and CFD trading on multiple TRADING PLATFORMS, including the globally popular MetaTrader 4 platform.
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