Learn more about how Forex works

How works the market Forex
Lo that must know of the market where is speculates with movements of the type of change between different currencies.

In an environment of low yields like that that we are living, many people are drawn when they promise big profits with their investments. That is precisely the largest tool sales of businesses that operate in the Forex market.

In Internet we can find various platforms operating online that allow access to this market with relatively small amounts. These companies in turn promoted in a very intense way its services through ads that are present throughout the network.


Forex is simply an abbreviation of Foreign Exchange. In this sense, is a market where there is speculation with movements of the exchange rate between different currencies. Opera 24 hours because it is not in any physical location, is fully electronic. Due to globalization, all the time, somewhere in the world (for example, day in Asia) and night in America someone is buying or selling one currency, either because you have to make a payment in another currency, because it requires to sell an asset or for reasons of coverage.


Let's start by saying that Forex is a very risky market. Indeed, you can profit by very large in a short period of time, but also very high losses (this is the part that does not tell us).

These income (or losses) are generated since it invests in highly leveraged manner, and depend on the broker and the leverage that the account allows. This means that if we risk $1,000 in one operation, we are actually participating in an operation by $100,000 (or more, as we mentioned, depends on the reason of leverage that allow us the platform's operation).

Then, if he's going well, going well: win as if we had invested $100,000 (and therefore gain can be very high in relation to the money that one invested) - less financial costs of leverage and, where appropriate, the Commission of the broker.

But if you are going wrong, we can even lose 100% of our capital invested in this operation is very easy. Or even more.

If our low investment and the $1,000 invested are no longer sufficient to pay what is known as "margin", make us a "margin call", which means that we have to put more money in our account to keep our existing operation. If you do not do this operation is suspended at the time automatically; and if we really went wrong (lost money), may be the case that we have lost more than what you spend, and stick with a debit balance.

Some brokers say their clients that this does not happen, since the positions can be protected with a type order stop-loss to limit our losses. However, we must be aware that an order of this kind is not always guarantee, since it may not run.

For example, if you put a stop-loss at 12.90, but on a day the exchange rate moves from 12.91 to 12.89 without arriving at any moment to be exactly 12.90, your stop-loss will not run or will run at a lower exchange rate and their loss may be greater than we anticipate.

To counter this argument, sometimes brokers say that this market move billions of dollars every second, which is not likely to happen, but it's a risk which must be aware.

On the other hand, it is important to know that it is a market not regulated by Mexican authorities, who we will not protect you in the event of any fraud or things like that. Although there are some operators or serious brokers, it is also very common that Forex phantom accounts are opened or do not exist. If one wants to enter this market, one has to fit with who operates. It has to be a serious company and whose staff is properly trained and qualified. And unfortunately it is not easy to know it for certain, although they may have a web page quite well placed.

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