The process of trading international currencies was once the reserve of men in suits with millions in the bank. However, thanks to the advent of online trading, the industry has been cracked open over the last few years and it's now accessible to everyone.
Of course, you still need the necessary knowledge to join the Forex trading world and make some money, but that doesn't change the fact that the computer has been used like a can opener to make the industry more accessible.
In a nutshell, online trading is a simple concept. You create an account with a recognised platform, such as AvaTrade, you download some software, load some money into your account and you start buying and selling currencies.
Because online trading is hugely efficient and accessible to millions of people, it means that trading platforms are able to offer leverage, which means the platform will multiply a user's investment by a certain amount (for example 50X).
This, in turn, means that online users can use a small amount of money to buy and sell large amounts of currency in the same way that professional Forex traders do.
Naturally, if you're thinking about becoming an online trader you need to treat it like a business. From planning your trades to carrying out the necessary research, you need to ensure that you take things seriously if you want to succeed in the marketplace.
The right hardware
Before you can even start your trading adventure, you need to ensure you have the right equipment. Like all online endeavours where making money is the main aim, speed and efficiency are crucial and you can only achieve this in the Forex world if you have the right hardware.
On a basic level, a stable, high-speed internet connection and a solid laptop or desktop are crucial. Because the trading world moves at a rapid pace, a few seconds can mean the difference between a profit and a loss.
Therefore, if you want to succeed online you need to have the hardware capable of processing vast amounts of information in the quickest time possible.
In fact, for any serious Forex trader, a second monitor is a must. Alongside the daily markets, you'll have to constantly monitor newsfeeds and market reports to ensure you're getting the latest insights into which currencies are hot and which ones are not.
Once you've arranged the simple things, the next step is to download the software necessary to complete trades and, moreover, analyse your data. Whenever you join established Forex trading platforms such as AvaTrade, you'll be able to download a product known as MetaTrade 4 (MT4).
In a nutshell, the advanced MT4 software is a trading platform that allows you to link up to the live currency exchange market and execute trades on a variety of currency pairs.
Because MT4 is open source, multiple brokers are able to plug into the system and use it for their own platforms. For users, this means it's possible to trade with a variety of brokers but still harness the power of MT4.
In addition to offering a live link to the currency exchange market, MT4 boasts a number of additional features designed to make trading more efficient, more accessible and more profitable for the average user.
The free online and mobile software download includes features such as market watch displays, charts to show the movements of a currency, a variety of indicators for analytical purposes, and ‘expert advisors’ that can automatically implement preset trading strategies.
Naturally, to make full use of these features and become a successful trader you'll need to do some research and learn a few new skills. However, the fact remains that online Forex trading is now something that virtually anyone can do.
Thanks to the power of computers and the internet, any adult, from a stay-at-home parent to a math genius, can now trade currencies and live out their Leonardo DiCaprio fantasy life as if they were the real Wolf of Wall Street.