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Most of what we write about at Shares concerns the stock market,
and that makes sense - after all, it's why we chose to call the
magazine that in the first place! But there is another form of
trading that has nothing to do with equity markets and has built
up a big following among private investors: currency, or foreign exchange.
Many of our readers have become familiar with derivative instruments -
CFDs, spread betting, futures, options and covered warrants. And if you can
trade the stock market using these, there's no reason in the world why you
shouldn't be able to handle the forex market. In many ways, it's a lot more
straightforward than shares.
Forex enthusiasts can reel off a long list of advantages it offers over other
instruments. The forex market is huge and highly liquid; you can trade 24
hours a day - following the sun across the world.s major banking centres
from Europe to the US, Australia, the Far East and back to Europe again. There
are no restrictions on shorting, you can trade a wide range of currencies
against each other, and leverage reduces the need to lay out large amounts of
capital. Moreover, it allows those who take an interest in understanding
world economic affairs to put their knowledge to profitable use.
Only in recent years has forex trading become accessible to the ordinary
individual - before that it was the province of currency dealers, banks and
other institutions, and the very rich. Large minimum transaction sizes and
tough financial requirements meant only the big guys could play. Now those
barriers have disappeared and with the increasing number of firms offering
services to private investors, along with sophisticated trading platforms,
market data, real-time news and charting, it has never been easier to become
an FX trader yourself.
This special Shares supplement is aimed at readers who have yet to try their
hand at forex and would like to find out more. We explain the basics, some
simple strategies and how to get started. Once you.ve tried it you will
probably find that, as with any form of trading, there is plenty more to be
learned. But like any journey of discovery, it starts with that all-important
first step. Good luck!
Jeremy Lacey
Editor
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