With so many different choices out there, how does a Forex "newbie" pick a broker? Chances are most new traders have no idea on where to start - and that's okay! We're here to help! We have put together a simple three step process to help you find a broker that YOU think will best suit YOUR needs. You might be thinking now, "Three steps? That's it?" Yesssiirrrr!

In the first step, you will go through some of the main questions you need ask yourself when reviewing different brokers. Then you will take a look at different brokers and their available features. We have put together a comparison guide by taking some of the most frequently asked questions across the internet, and surveyed some of the most frequently asked about brokers out there, so that you don't have to.

With this guide, you can narrow your choices down and take the final step of talking with different brokers and demo trading on different platforms. Simple, right? Let's begin...

Step 1: Do your research

Before comparing brokers, do you know what to look for? No? Well, here are a few of the main questions you should ask yourself:

1. Is this broker registered with any regulating authorities? Check to see if your broker of choice is registered with the National Futures Association (NFA) or Commodity Futures Trading Commission (CFTC) if they're based in the US. If the broker is based in the United Kingdom, check with the Financial Service Authority (FSA). If the broker isn't registered with any of these or any other recognized regulating firm, then you may want to think twice before signing up with them.
2. Dealing Desk or Non-Dealing Desk broker? Does the broker offer fixed or non-fixed spreads? How wide are the spreads? These questions are more significant to those traders who like to take quick profits on a few pips. Large and/or variable spreads can cut into the profits of this type of trading strategy.
3. How much or how little leverage will a broker give you? We highly recommend you review "Leverage the Killer"before deciding on how much leverage would be suitable for your trading style. The phrase, "Less is More," can save every newbie
4. Of course, you’re not going to start trading with real money right away, right? Well, when you do having a winning strategy and you are ready to trade live; knowing how much risk capital you have to start with makes a big difference. If you have $2000 or less to start with then you probably want to start trading "micro" lots. Not every broker has this feature.
5. Does this broker credit or debit daily rollover interest? Some brokers either do both, deduct interest, or neither. This information is important to traders who hold positions overnight.
6. Does this broker over premium services such as charting, news feeds, and market commentary? How important are premium services to my trading?

Step 2: Compare brokers

Let's not beat around the bush, now you need go to Broker Comparison Guide.

Step 3: Open demo accounts and ask questions.

Pick at least two brokers that fits most of your criteria and open up demo accounts. Trade in different market environments. Learn all the different features of each trading platform. If you have questions, don't be afraid to ask. Many brokers have excellent customer service support and would be happy to answer your questions.

Most demo trading platforms are very similar to their live counterparts, but not exactly the same. There may be a difference in speed of execution, slippage, and platform reliability (most of the time live accounts are more reliable than demo accounts). When you do have your strategy down and you are ready to move to a live account, start off small, test the waters, and see if this particular broker will suit your trading needs.

Trading the news is becoming a popular technique to trade the forex markets … and why shouldn’t it be? Time and time again you see currency pairs move 50 to 100 pips within minutes or even seconds after a major news release. When you see that, I bet you’re thinking, “50 to 100 pips!? That’s easy money!” Maybe it is, and maybe it isn’t. It all depends on how prepared you are to trade a news release.

The goal of this lesson isn’t to give you a specific “Trading the News” strategy. The goal is to point you in the right direction and show some of the risks involved with trading these events, because we want to help you help yourself in developing your own methods that fit YOU best.

Why Trade the News?

Trading news releases can be a significant tool in your trading arsenal. If you want, it can be your only weapon altogether. Economic news reports often spur strong short-term moves in the market, which are great trading opportunities for breakout traders. And with the forex being open 24 hours a day and a true worldwide market, there are plenty of opportunities almost every trading day to catch market volatility (aka a lot of pips!) kicked off by an economic news report.

Which Pairs Should I Trade?

Here is a list of the top currencies and countries in which you should focus on for news trading:

Symbol	Country	Currency	Nickname
USD	United States	Dollar	Buck
EUR	European Union	Euro	Fiber
JPY	Japan	Yen	Yen
GBP	Great Britain	Pound	Cable
CHF	Switzerland	Franc	Swissy
CAD	Canada	Dollar	Loonie
AUD	Australia	Dollar	Aussie
NZD	New Zealand	Dollar	Kiwi

Now, there are plenty more currencies available to trade, but this list is based on the size of each country’s economy, frequency of news releases and the trading liquidity of their currency.

When are News Releases uh Released?

The list below displays the times when the most important economic data are released for each of the countries. Make sure you know them or go broke.

Symbol	Country	Time (GMT)
USD	United States	13:30 - 15:00
EUR	Germany	07:00 - 11:00
EUR	France	07:45 - 09:00
EUR	Italy	08:45 - 10:00
JPY	Japan	23:50 - 04:30
GBP	Great Britain	07:00 - 09:30
CHF	Switzerland	06:45 - 10:30
CAD	Canada	12:00 - 13:30
AUD	Australia	22:30 - 00:30
NZD	New Zealand	21:45 - 02:00

In the FX market, you buy or sell currencies. Placing a trade in the foreign exchange market is simple: the mechanics of a trade are very similar to those found in other markets (like the stock market), so if you have any experience in trading, you should be able to pick it up pretty quickly.

The object of Forex trading is to exchange one currency for another in the expectation that the price will change, so that the currency you bought will increase in value compared to the one you sold.

Example of making money by buying euros

Trader's Action	EUR	USD
You purchase 10,000 euros at the EUR/USD exchange rate of 1.18	+10,000	-11,800*
Two weeks later, you exchange your 10,000 euros back into US dollars at the exchange rate of 1.2500.	-10,000	+12,500**
You earn a profit of $700.	0	+700

*EUR 10,000 x 1.18 = US $11,800
** EUR 10,000 x 1.25 = US $12,500

An exchange rate is simply the ratio of one currency valued against another currency. For example, the USD/CHF exchange rate indicates how many U.S. dollars can purchase one Swiss franc, or how many Swiss francs you need to buy one U.S. dollar.

How to Read an FX Quote

Currencies are always quoted in pairs, such as GBP/USD or USD/JPY. The reason they are quoted in pairs is because in every foreign exchange transaction you are simultaneously buying one currency and selling another. Here is an example of a foreign exchange rate for the British pound versus the U.S. dollar:

GBP/USD = 1.7500

The first listed currency to the left of the slash ("/") is known as the base currency (in this example, the British pound), while the second one on the right is called the counter or quote currency (in this example, the U.S. dollar).

When buying, the exchange rate tells you how much you have to pay in units of the quote currency to buy one unit of the base currency. In the example above, you have to pay 1.7500 U.S. dollar to buy 1 British pound.

When selling, the exchange rate tells you how many units of the quote currency you get for selling one unit of the base currency. In the example above, you will receive 1.7500 U.S. dollars when you sell 1 British pound.

The base currency is the “basis” for the buy or the sell. If you buy EUR/USD this simply means that you are buying the base currency and simultaneously selling the quote currency.

You would buy the pair if you believe the base currency will appreciate (go up) relative to the quote currency. You would sell the pair if you think the base currency will depreciate (go down) relative to the quote currency.

Long/Short

First, you should determine whether you want to buy or sell.

If you want to buy (which actually means buy the base currency and sell the quote currency), you want the base currency to rise in value and then you would sell it back at a higher price. In trader's talk, this is called "going long" or taking a "long position". Just remember: long = buy.

If you want to sell (which actually means sell the base currency and buy the quote currency), you want the base currency to fall in value and then you would buy it back at a lower price. This is called "going short" or taking a "short position". Short = sell.

Bid/Ask Spread

All Forex quotes include a two-way price, the bid and ask. The bid is always lower than the ask price.

The bid is the price in which the dealer is willing to buy the base currency in exchange for the quote currency. This means the bid is the price at which you (as the trader) will sell.

The ask is the price at which the dealer will sell the base currency in exchange for the quote currency. This means the ask is the price at which you will buy.

The difference between the bid and the ask price is popularly known as the spread.

Let's take a look at an example of a price quote taken from a trading platform:

On this GBP/USD quote, the bid price is 1.7445 and the ask price is 1.7449. Look at how this broker makes it so easy for you to trade away your money.

If you want to sell GBP, you click "Sell" and you will sell pounds at 1.7445. If you want to buy GBP, you click "Buy" and you will buy pounds at 1.7449.

In the following examples, we're going to use fundamental analysis to help us decide whether to buy or sell a specific currency pair. If you always fell asleep during your economics class or just flat out skipped economics class, don’t worry! We will cover fundamental analysis in a later lesson. For right now, try to pretend you know what’s going on…

EUR/USD
In this example Euro is the base currency and thus the “basis” for the buy/sell.

If you believe that the US economy will continue to weaken, which is bad for the US dollar, you would execute a BUY EUR/USD order. By doing so you have bought euros in the expectation that they will rise versus the US dollar.

If you believe that the US economy is strong and the euro will weaken against the US dollar you would execute a SELL EUR/USD order. By doing so you have sold Euros in the expectation that they will fall versus the US dollar.

USD/JPY
In this example the US dollar is the base currency and thus the “basis” for the buy/sell.

If you think that the Japanese government is going to weaken the Yen in order to help its export industry, you would execute a BUY USD/JPY order. By doing so you have bought U.S dollars in the expectation that they will rise versus the Japanese yen.

If you believe that Japanese investors are pulling money out of U.S. financial markets and converting all their U.S. dollars back to Yen, and this will hurt the US dollar, you would execute a SELL USD/JPY order. By doing so you have sold U.S dollars in the expectation that they will depreciate against the Japanese yen.

GBP/USD
In this example the GBP is the base currency and thus the “basis” for the buy/sell.

If you think the British economy will continue to do better than the United States in terms of economic growth, you would execute a BUY GBP/USD order. By doing so you have bought pounds in the expectation that they will rise versus the US dollar.

If you believe the British's economy is slowing while the United State's economy remains strong like bull, you would execute a SELL GBP/USD order. By doing so you have sold pounds in the expectation that they will depreciate against the US dollar.

USD/CHF
In this example the USD is the base currency and thus the “basis” for the buy/sell.

If you think the Swiss franc is overvalued, you would execute a BUY USD/CHF order. By doing so you have bought US dollars in the expectation that they will appreciate versus the Swiss Franc.

If you believe that the US housing market bubble burst will hurt future economic growth, which will weaken the dollar, you would execute a SELL USD/CHF order. By doing so you have sold US dollars in the expectation that they will depreciate against the Swiss franc.

I don't have enough money to buy 10,000 euros. Can I still trade?

You can with margin trading! Margin trading is simply the term used for trading with borrowed capital. This is how you're able to open $10,000 or $100,000 positions with as little as $50 or $1,000. You can conduct relatively large transactions, very quickly and cheaply, with a small amount of initial capital.

Margin trading in the foreign exchange market is quantified in “lots”. We will be discussing these in depth in our next lesson. For now, just think of the term "lot" as the minimum amount of currency you have to buy. When you go to the grocery store and want to buy an egg, you can't just buy a single egg; they come in dozens or "lots" of 12. In Forex, it would be just as foolish to buy or sell 1 euro, so they usually come in "lots" of 10,000 (Mini) or 100,000 (Standard) depending on the type of account you have.

For Example:

• You believe that signals in the market are indicating that the British Pound will go up against the US dollar.
• You open one lot (100,000), buying with the British pound at 1% margin and wait for the exchange rate to climb. When you buy one lot (100,000) of GBP/USD at a price of 1.5000, you are buying 100,000 pounds, which is worth US$150,000 (100,000 units of GBP * 1.50 (exchange rate with USD)). If the margin requirement was 1%, then US$1500 would be set aside in your account to open up the trade (US$150,000 * 1%). You now control 100,000 pounds with US$1500. Your predictions come true and you decide to sell.
• You close the position at 1.5050. You earn 50 pips or about $500. (A pip is the smallest price movement available in a currency).

Your Actions	GBP	USD
You buy 100,000 pounds at the GBP/USD exchange rate of 1.5000	+100,000	-150,000
You blink for two seconds and the GBP/USD exchange rate rises to 1.5050 and you sell.	-100,000	+150,500**
You have earned a profit of $500.	0	+500

When you decide to close a position, the deposit that you originally made is returned to you and a calculation of your profits or losses is done. This profit or loss is then credited to your account.

We will also be discussing margin more in-depth in the next lesson, but hopefully you're able to get a basic idea of how margin works.

Rollover

No, this is not the same as rollover minutes from your cell phone carrier! For positions open at your broker's "cut-off time" usually 5pm EST, there is a daily rollover interest rate that a trader either pays or earns, depending on your established margin and position in the market. If you do not want to earn or pay interest on your positions, simply make sure they are all closed before 5pm EST, the established end of the market day.

Since every currency trade involves borrowing one currency to buy another, interest rollover charges are part of forex trading. Interest is paid on the currency that is borrowed, and earned on the one that is bought. If a client is buying a currency with a higher interest rate than the one he/she is borrowing, the net differential will be positive (i.e. USD/JPY) - and the client will earn funds as a result. Ask your broker or dealer about specific details regarding rollover.

Also note that many retail brokers do adjust their rollover rates based on different factors (e.g., account leverage, interbank lending rates). Please check with your broker for more information on rollover rates and crediting/debiting procedures.

Don't know what the interest rates are for each currency? Here is a chart to help you out. Accurate as of 04/19/09.

Demo Trading

You can open a demo account for free with most Forex brokers. This account has the full capabilities of a "real" account. Why is it free? It's because the broker wants you to learn the ins and outs of their trading platform, and have a good time trading without risk, so you'll fall in love with them and deposit real money. The demo account allows you to learn about the Forex markets and test your trading skills with ZERO risk.

YOU SHOULD DEMO TRADE FOR AT LEAST 6 MONTHS BEFORE YOU EVEN THINK ABOUT PUTTING REAL MONEY ON THE LINE.

I REPEAT - YOU SHOULD DEMO TRADE FOR AT LEAST 6 MONTHS BEFORE YOU EVEN THINK ABOUT PUTTING REAL MONEY ON THE LINE.

"Don't Lose Your Money" Declaration

Place your hand on your heart and say...

"I will demo trade for at least 6 months before I trade with real money."

Now touch your head with your index finger and say...

"I am a smart and patient Forex trader!"

What is FOREX?

The Foreign Exchange market, also referred to as the "FOREX" or "Forex" or "Retail forex" or "FX" or "Spot FX" or just "Spot" is the largest financial market in the world, with a volume of over $4 trillion a day. If you compare that to the $25 billion a day volume that the New York Stock Exchange trades, you can easily see how enormous the Foreign Exchange really is. It actually equates to more than three times the total amount of the stocks and futures markets combined! Forex rocks!

What is traded on the Foreign Exchange market?

The simple answer is money. Forex trading is the simultaneous buying of one currency and the selling of another. Currencies are traded through a broker or dealer, and are traded in pairs; for example the euro and the US dollar (EUR/USD) or the British pound and the Japanese Yen (GBP/JPY).

Because you're not buying anything physical, this kind of trading can be confusing. Think of buying a currency as buying a share in a particular country. When you buy, say, Japanese Yen, you are in effect buying a share in the Japanese economy, as the price of the currency is a direct reflection of what the market thinks about the current and future health of the Japanese economy.

In general, the exchange rate of a currency versus other currencies is a reflection of the condition of that country's economy, compared to the other countries' economies.

Unlike other financial markets like the New York Stock Exchange, the Forex spot market has neither a physical location nor a central exchange. The Forex market is considered an Over-the-Counter (OTC) or 'Interbank' market, due to the fact that the entire market is run electronically, within a network of banks, continuously over a 24-hour period.

Until the late 1990's, only the "big guys" could play this game. The initial requirement was that you could trade only if you had about ten to fifty million bucks to start with! Forex was originally intended to be used by bankers and large institutions - and not by us "little guys". However, because of the rise of the Internet, online Forex trading firms are now able to offer trading accounts to 'retail' traders like us.

All you need to get started is a computer, a high-speed Internet connection, and the information contained within this site.

BabyPips.com was created to introduce novice or beginner traders to all the essential aspects of foreign exchange, in a fun and easy-to-understand manner.

What is a Spot Market?

A spot market is any market that deals in the current price of a financial instrument.

Which Currencies Are Traded?

The most popular currencies along with their symbols are shown below:

Symbol	Country	Currency	Nickname
USD	United States	Dollar	Buck
EUR	Euro members	Euro	Fiber
JPY	Japan	Yen	Yen
GBP	Great Britain	Pound	Cable
CHF	Switzerland	Franc	Swissy
CAD	Canada	Dollar	Loonie
AUD	Australia	Dollar	Aussie
NZD	New Zealand	Dollar	Kiwi

Forex currency symbols are always three letters, where the first two letters identify the name of the country and the third letter identifies the name of that country’s currency.

When Can Currencies Be Traded?

The spot FX market is unique within the world markets. It’s like a Super Wal-Mart where the market is open 24-hours a day. At any time, somewhere around the world a financial center is open for business, and banks and other institutions exchange currencies every hour of the day and night with generally only minor gaps on the weekend.

The foreign exchange markets follow the sun around the world, so you can trade late at night (if you’re a vampire) or in the morning (if you’re an early bird). Keep in mind though, the early bird doesn’t necessarily get the worm in this market - you might get the worm but a bigger, nastier bird of prey can sneak up and eat you too…

Time Zone	New York	GMT
Tokyo Open	7:00 pm	0:00
Tokyo Close	4:00 am	9:00
London Open	3:00 am	8:00
London Close	12:00 pm	17:00
New York Open	8:00 am	13:00
New York Close	5:00 pm	22:00

The Forex market (OTC)

The Forex OTC market is by far the biggest and most popular financial market in the world, traded globally by a large number of individuals and organizations. In the OTC market, participants determine who they want to trade with depending on trading conditions, attractiveness of prices and reputation of the trading counterpart.

The chart below shows global foreign exchange activity. The dollar is the most traded currency, being on one side of 86% of all transactions. The euro’s share is second at 37%, while that of the yen is third at 16.5%.

Why Trade Foreign Currencies?

There are many benefits and advantages to trading Forex. Here are just a few reasons why so many people are choosing this market:

• No commissions.
  No clearing fees, no exchange fees, no government fees, no brokerage fees. Brokers are compensated for their services through something called the bid-ask spread.
• No middlemen. Spot currency trading eliminates the middlemen, and allows you to trade directly with the market responsible for the pricing on a particular currency pair.
• No fixed lot size.
  In the futures markets, lot or contract sizes are determined by the exchanges. A standard-size contract for silver futures is 5000 ounces. In spot Forex, you determine your own lot size. This allows traders to participate with accounts as small as $250 (although we explain later why a $250 account is a bad idea).
• Low transaction costs.
  The retail transaction cost (the bid/ask spread) is typically less than 0.1 percent under normal market conditions. At larger dealers, the spread could be as low as .07 percent. Of course this depends on your leverage and all will be explained later.
• A 24-hour market.
  There is no waiting for the opening bell - from Sunday evening to Friday afternoon EST, the Forex market never sleeps. This is awesome for those who want to trade on a part-time basis, because you can choose when you want to trade--morning, noon or night.
• No one can corner the market.
  The foreign exchange market is so huge and has so many participants that no single entity (not even a central bank) can control the market price for an extended period of time.
• Leverage.
  In Forex trading, a small margin deposit can control a much larger total contract value. Leverage gives the trader the ability to make nice profits, and at the same time keep risk capital to a minimum. For example, Forex brokers offer 200 to 1 leverage, which means that a $50 dollar margin deposit would enable a trader to buy or sell $10,000 worth of currencies. Similarly, with $500 dollars, one could trade with $100,000 dollars and so on. But leverage is a double-edged sword. Without proper risk management, this high degree of leverage can lead to large losses as well as gains.
• High Liquidity.
  Because the Forex Market is so enormous, it is also extremely liquid. This means that under normal market conditions, with a click of a mouse you can instantaneously buy and sell at will. You are never "stuck" in a trade. You can even set your online trading platform to automatically close your position at your desired profit level (a limit order), and/or close a trade if a trade is going against you (a stop loss order).
• Free “Demo” Accounts, News, Charts, and Analysis. Most online Forex brokers offer 'demo' accounts to practice trading, along with breaking Forex news and charting services. All free! These are very valuable resources for “poor” and SMART traders who would like to hone their trading skills with 'play' money before opening a live trading account and risking real money.
• “Mini” and “Micro” Trading:
  You would think that getting started as a currency trader would cost a ton of money. The fact is, compared to trading stocks, options or futures, it doesn't. Online Forex brokers offer "mini" and “micro” trading accounts, some with a minimum account deposit of $300 or less. Now we're not saying you should open an account with the bare minimum but it does makes Forex much more accessible to the average (poorer) individual who doesn't have a lot of start-up trading capital.

What Tools Do I Need to Start Trading Forex?

A computer with a high-speed Internet connection and all the information on this site is all that is needed to begin trading currencies.

What Does It Cost to Trade Forex?

An online currency trading (a “micro account”) may be opened with a couple hundred bucks. Do not laugh – micro accounts and its bigger cousin, the mini account, are both good ways to get your feet wet without drowning. For a micro account, we'd recommend at least $1,000 to start. For a mini account, we’d recommend at least $10,000 to start.

What Is Forex?

Forex is the knowledge and business of making money through trading foreign currencies. Forex is not a new business and its history is as old as the history of money.

What is forex is a question that people ask a lot these days. There are people who have been making money through Forex from many years ago. Fortunately, with the help of computer and internet, Forex trading has become much easier. You can sit at your personal computer and trade from home without having to make any phone call or referring to any bank.

How is it possible?

There are brokerage companies that enable you to buy and sell different currencies through the Internet and some simple softwares. For any trade that you make, you pay a small commission to the brokerage company that you are trading through it.

You need to find a good, reliable and well-known brokerage company and sign up for an account with it. Then you have to fund your account. You use the money you have in your account to trade. Any profit that you make, will be added to your account and visa versa. Then you can withdraw the money you have made.

What currencies can you trade?

In Forex, you deal with currency pairs. There are four main currency pairs: British Pound and USD (GBP/USD), Euro and USD (EUR/USD), USD and Japanese Yen (USD/JPY), USD and Swiss Frank (USD/CHF).

In each currency pair, the first currency works as commodity and the second one works as money. For example when you choose GBP/USD to trade, if you buy, you buy British Pound against USD and if you sell, you sell British Pound against USD. It doesn’t matter what currency you have in your account. The trading software takes care of the exchanges and transactions automatically.

How can you make money?

Buying low and selling high or selling high and buying low is the base of making money in Forex. For example If you buy GBP against USD when each GBP is equal to $1.9554USD and then sell it when it is $2.0235USD, you have made a profit. I don’t want to focus on more details in this article and explain how the profits and the money you make will be calculated. I will talk about these topics in other articles.

But the big question is that how you can find out the best time to buy and how you can predict that if you buy, the price will go up and you will make a profit? This is the most important question that makes you a successful trader.

There are two methods to know the optimum time to buy and sell: Technical and Fundamental Analysis.

In technical analysis, you can predict the direction of the price using the the price chart analysis and also with the help of some special tools that are called Indicators.

GBP/JPY price chart with three indicators: RSI and MACD

Technical Analysis is a science and if you want to start working on Forex, you have to learn it properly, especially if you want to work as an intraday trader. It is not too hard to learn the technical analysis. If you are a focused and a serious person, you can learn technical analysis in a few months. There are a lot of free resources over the web that you can use to learn. There are some expensive training courses but those who sign up for them are not happy and believe that they have learned nothing. So don’t waste your money. If you are serious to learn, there are a lot of free resources over the Internet. You can also visit this weblog every now and then or subscribe for my RSS feed. I will try to share my experiences with you.

The other method is the Fundamental Analysis. This method is used to predict the future movements of currencies’ prices, according to the economic and even political situation of the world and important developed countries like USA, UK, Germany, Japan and… .

Fundamental analysis has a long term usage but good traders can predict the sudden changes that happen after releasing an important news about economic situation of an important country. For example when the news says that economic situation of USA is improved for 5% in comparison to the last month, USD will become stronger and people start buying it. So the value of USD will go up because of the sudden increase of demand. If you know the effect of the news on the price, you can take the proper position and make money. Of course there are two sides in this story which means if you take the wrong position, you will lose.

Experienced and professional traders take the advantage of both technical and fundamental analysis whereas 99% of traders are dependent on the technical analysis.

Some good things about Forex:

1- Forex is an online home based business that doesn’t need referring, recruiting and advertising. You only deal with the currencies through the Internet. So you will not have to reply any email, make any phone call and spend any money on advertising.

2- If you learn Forex trading properly, you can make a lot of money. Forex can be your full time job that makes thousands of dollars for you every month. I have to emphasize again that if you start working on Forex before you learn it properly, it can be risky and you will lose your money. It is like driving. If you drive a car, before you learn to drive properly, you will hurt yourself and others but if you learn it properly first, it will be pleasant and funny.

3- You can make a lot of money by spending a small amount of money. Unlike other investments like stock market that you have to invest a lot of money to make a reasonable profit, you can make a good income through investing small amount of money. For example, with a $5000 account, you can make about $5000 per month. Of course it highly depends on the way that you trade and the strategy that you follow but good and experienced traders can double their money every month.

4- Forex - and of course stock market - are the only businesses that competition has positive impact on them. It is amazing, isn’t it? Competition is the biggest problem in all other businesses but in Forex, it helps the traders to make more money. Why?

Supply and demand are the factors that determine the price in any market. When there are too many buyers and sellers, price volatility will be much higher and market will be more dynamic. Price will go up and down more frequently and this is what we need to make money. When price goes up we buy and when it goes down we sell and make profit.

So if you choose Forex as your business, you will not have to be worried about competition.

Since it might be a bit too complicated for a beginner to figure out how to make money in Forex, we offer you this example:

You believe that the Euro to US Dollar (EURUSD) rate will increase. In your account you have 2000 USD (eGlobal-standard). At a price of 1.2750 you buy 150,000 Euro for 150,000*1.2750 = 191,250 USD.

This is possible because of credit, which allows you to make transactions worth 100 times more than funds you have in your account (in this specific case, the maximum sum available for transactions is 2000*100 = 200,000 USD).

After a period of time, the exchange rate increases. You sell 150,000 Euro at the rate of 1.2850 and get 150,000*1.2850 = 192,750 USD.

Thus, after buying at a low rate and selling at a high rate, the difference 192,750 - 191,250 = 1500 $ is your gain. You have earned 75% of initial funds in your account, while the rate increased by 0.8%.

Another way of making a profit on Forex is based on the decrease of the quotation rate of the EURUSD currency pair:

Having created a real account with 200 USD in it (eGlobal-mini), you determine the upper and lower limits on the Euro to Dollar chart and sell 15,000 Euro (0.15 lot) at the upper limit for a price of 1.2850 (bid price) USD for 1 Euro, which equals 19,275 USD (15,000 Euro multiplied by the rate of 1.2850).

You have funds in USD in your account, but you can sell Euro using the automatic borrowing system. Hence, the company lends you 15,000 Euro free of charge, which you can sell by sending a selling request. Due to the leverage, the actual deposit is 100 times less than the sum sold: 15,000/100 = 150 euro. At a rate of 1.2850 this equals 192,75 USD. This very sum is going to be a deposit for a credit (marginal) transaction for your account. The maximum possible deposit in this case equals 200 USD.

Then during the day the price drops to the lower limit and you decide to buy 15,000 Euro at a price of 1.2750 (ask price) USD for 1 Euro, which equals 19,125 USD. The 15,000 Euro that you have bought are written off your account towards the repayment of the company loan, while the difference is left in your account.

Thus, due to the fall in the exchange rate you earn the difference between sold and bought, which is 19,275 - 19,125 = 150 USD. You managed to earn 75% (150 dollars) of your initial sum of 200 USD due to a rate decrease by 0.8% (from 1.2850 to 1.2750) in only one day.

The company takes a commission in the form of the difference between the ask and bid prices or spread, which in this example is 3 USD (spread of EuroDollar pair equals 0.0002 or 2 pips). More detailed information on terminology.

In these examples, the spread is not taken into consideration while calculating percentages of rate changes because of its non-essential influence on the results. In the case of mircoForex or eGlobal-standard the calculations are similar with a difference only in account currency US cents for micro, USD for mini & standard. The consecutive use of the transactions shown gives the income of 75%+75% = 150%. In actual practice a much greater return may be achieved by using corresponding money management methods. Risk management methods also play an important role in trade.

Theoretical knowledge and experience are needed in order to earn money on any financial market. This work experience includes:

• Fundamental analysis
• Technical analysis
• Money and risk management

Fundamental analysis allows to determine the dependence of exchange rates of different currencies on the economic situation of countries; explains the purposes and instruments of central bank's financial policy; and reveals the proportion of different financial markets, reasons for their development and stagnation. Fundamental analysis is used for middle and long-term prognosis; it evaluates the perspectives of a market situation. It is built on fundamental mutually intertwined economic factors. The biggest difficulty lies in the fact that changes in one of those factors can influence all the rest, the number of which varies from 20 to 50 depending on the country. That's why fundamental analysis is not used by everyone. Only 10-20 % of traders apply it in their practice.

Technical analysis includes examination of price diagrams, price history, and the number of changes in quotation within a certain period of time. It's very convenient to use because data on prices is available online. Technical analysis mainly gives information about market activity and only conditionally about market volume considering only short periods of time called time-frames.

Money and risk management is the third and also very important aspect of the trading system. Financial operations on Forex are very risky, and often the higher the supposed profit the higher the risk. Following all rules of money and risk management helps reduce losses and increase profits.

Money and risk management appeared in 18th century, when it was applied in gambling to raise the chances for winning. Mature players followed their own strategies, incurred losses to enjoy profits later. Working on financial markets is similar to gambling because both profits and losses are not predictable. That's why principles of money and risk managements started to be used in the financial sphere.

It often happens that beginner traders do not take aspects of money and risk management seriously; but this mistake can lead to failure even with a good trade strategy. Not just sums of earned money are important in trading; amounts of losses during work add to success as well. That's why it's recommended to calculate the portion of risk-subjected capital for successful trading.

Methods of money management

Working in Forex traders should be able to distribute capital correctly, calculate the amount of money involved in a deal to get sufficient profit; and in case of losses not to lose all deposited money.

For these purposes special methods of money management exist:

• Absence of money management. Many traders who open a position don't count money used in operations, don't calculate approximate profit and possible losses. This is one of the tactics. But if the capital is not large it will disappear after several deals.
• Multilateral contracts. Opening several positions of different instruments on Forex, such as EURUSD and EURGBP in the case of prices moving in the right direction, the trader can get good profits from these contracts. Both profit and loss in such deals can be significant.
• Fixed sum of money. Depending on the amount of money in his account the trader decides how much he can put at risk when opening one or another position. The trader doesn't exceed the limit he has fixed himself.
• Fixed percentage of capital. This method is similar to the previous one with the only difference being that the trader sets the percentage of the capital and not the amount of the capital itself.
• Coordination of profits and losses. It is necessary to keep statistics of all operations (number of losses, wins and their connection). This connection shows that losses and wins take turns or several losses are followed by several successful operations. It makes sense to increase the volume of the position after a number of losses hoping for winning and, on the contrary, decrease after a positive period expecting losses again.
• Intersection of the curved moving capital average. The principle is based on the well-known method of moving average as a signal for entering the market or leaving it. Moving averages (long one and short one) are used for estimating the results of arranged deals. If the short curved is above the long one it's a signal for opening positions to gain profit; and if it's below it then better times are still to come.

Having chosen one or another method of money management for trading, you will be able to use your money rationally, and it will bring profit. Methods of money management are applied before opening of positions.

If you're still having a hard time trying to figure out which niche market to go into, start by simply spending some time asking questions of yourself...What are my favorite hobbies, interests, activities, etc. Or...What are some things I don't know yet but have a burning desire to learn more about? Start a list and add all your favorites to it.

Here's a list of some of the most popular subjects people are paying for...

Dating, Seduction, Sex Advice, Relationships

Losing weight, gaining muscle, looking more attractive

Health & fitness, cures/reliefs from specific diseases & ailments

Spying, online privacy and security

Safety, personal security, and protection of self and loved ones (self defense, home security, scam prevention, etc.)

How to use computers and the Internet

Mental influence, persuasion, and dominance

General self-help, self improvement, personal development, and success

Hobbies and special interests: cooking, magic, UFO's, metaphysics, becoming more competitive in sports, activities, etc.

Making money, aside from marketing information: investing, stock market, futures trading, real estate tips, and other related financial information

And of course, having more control and freedom in their lives!

People are always looking to improve themselves or some area of their lives. They are always trying to find solutions to problems.

There are sites catering to some of the above categories that are already generating thousands of dollars every month. I have personally sold products on some of the above categories and done very well.

Yet, we haven't even begun to tap the true profit potential in these areas yet because there's very little competition in most of these areas, especially when compared to the "how-to marketing" area! The potential to make money from the above special-interest categories is huge - and it's wide open!

Moreover, as more and more people get accustomed to buying digital products, you can easily imagine making insane amounts of money through these topics well into the future.

You could pick any one of the above subjects that you personally have an interest in and run with it.

(Feel free to use this article online and in your email newsletters as long as you leave it intact and do not alter it in anyway. The by-line and resource box must remain in the article all links must be active hyperlinks.)

Keywords: make money online,marketing,internet marketing,home business, work from home,work at home

Making money online used to be easier. With fewer websites, it was easier for people to find you. This is not true any longer. Still, some people do well online. What are the secrets of online money makers?

The secrets of online money makers are mostly common sense. If you want to make money online, do something you love. Then realize that this is going to take time and effort.
Many people are looking for quick riches or easy wealth. The secret of online money makers is that they are prepared to work hard. They choose something they love so that they stay motivated. Online money makers learn everything they can about promoting their particular form of making money. They don't expect immediate wealth. They work on their business daily and continue to learn as they grow.

Promotion is a critical secret of online money makers. Promotion helps customers find them. Sometimes the rules of search engines change, and online money makers keep up with these changes. It's what they do for a living.

Good customer service is another essential secret of online money makers. You want customers who will come back and customers who will tell others about you. It's no longer just word of mouth when a business serves somebody well. Now that customer might tell some friends in an email, who will tell other friends, and work can get around pretty fast. They can also post their reviews at various websites, which can gain you more customers.

The secrets of online money makers are not any different than making money any other way. It's about doing what you love, working hard, learning to promote, and serving the customer well. If you can do that, you can make money online.

RSS stands for Really Simple Syndication or Rich Site

Summary. It also has been referred to as a "pull" technology rather than a "push" technology. And, in fact, this feature is what makes RSS so popular in terms of today's Internet usage.

It's probably hard to argue that anyone who uses the Internet today hasn't heard of spam. If they have an email inbox it is probably full of it.

Spam, for the uninitiated, is the receipt of unwanted emails from people whom you did not request to receive information. Spam represents the "push" technology. That is, people "push" their email message at your inbox, whether you have asked to receive the email or not.

And that aspect of "push" technology is what many have come to believe is the death of email. It's arguable that email will still be around for quite a long time, even though there are still people who continue the illegal spam process. In fact, companies are making millions now just providing everyday users as well as huge corporations, solutions claiming to solve their spam problem.

RSS, on the other hand, can be said to be the exact opposite of the email "push" technology. Because you cannot "push" your message to subscribers. In fact, the only way that people can subscribe to an RSS feed is to do so voluntarily. And, at the same time, they can unsubscribe whenever they want.
That's why it's called a "pull" technology. Because subscribers "pull" information into their readers and, if the content isn't what they expect, they can unsubscribe whenever they'd like. So, unlike the email "push" technology, there is no one using RSS that is experiencing an inbox full of spam. All they have to do is to unsubscribe and they will never receive another message from the person who provided the feed.

RSS has become a popular way to make money on line too. And that is due in part to the popularity of the RSS "pull" technology. Here's one way of monetizing a website using RSS feeds.

Imagine setting up a static one page web site - a minisite if you will. Now, add either Google Adsense code or the new Yahoo version of the Google Adsense style ads that, when clicked by a visitor - you earn cash.

This gives you a nice starting point and, if you optimize your web page properly, there is a good chance you will get a high ranking in the search engines. And, the more people who see your page, the more likelihood they will click on one of the links on your web page and you'll earn revenue from the click.

But RSS provides an even greater potential. Because by adding an RSS feed to that same web page, you turn a static web page that only contains the information you placed on it, into a dynamic ever changing web page that others will likely come back more than once to read.

After all, once someone has read a one page web site, what incentive is there for them to come back? Plenty, if you use RSS feeds on your web page. It is possible to add 5, 10 or 15 feeds on your once static web page and now, you've got a page that automatically updates itself and provides something that people will want to come back to read time and time again.

You can easily convert any web page into a dynamic web page using free RSS creator software. One of the most popular free versions is called Carp and you can download it at this web link: http://www.geckotribe.com/rss/carp/.

Once you've set this program up on your website and added the proper code to your website, then you will need to collect RSS feeds that relate to the topic of your web page.

Let's say that the topic of your web page is flower gardens. You could go to Google News and get their RSS feed code, place it into the appropriate position in your Carp coding you put on your web page and then adjust the code as follows: http://news.google.com/news?hl=en&q=flower+gardens&ie=UTF-8&output=rss You can also get a similar feed from Topix.net and you'd adjust the code like this: http://rss.topix.net/search/?q=flower+gardens&xml=1

Now, once you have uploaded your web page, your site will automatically pull in fresh information from Google and Topix about flower gardens. Simply follow this illustration for any web page you'd like to monetize and watch your search engine ranking soar and also your bank account!

If you are new to the internet and wondering what an earth this blogging craze is all about, or if you already have your own website and you’re wondering why everyone keeps advising you to start your own blog, read on. I’m going to explain to you what a blog is, why you need one, how to set it up, promote it and of course, make money from it .

Blog is short for “web log” and is similar to an online diary or journal. The craze of blogging began in the very late 1990s and has started to become more and more popular over the last couple of years. Almost everyone seems to have a blog these days, from CEOs of large companies to webmasters, from world travelers to teenagers. Even my Dad has his own blog now! A blog allows you to communicate informally with people via an online journal, but it’s more personal and unstructured than a website and easier and cheaper to set up than a website.

If you have your own website, but haven’t yet started a blog you can easily start one using a free service such as Blogger or WordPress. Try to post to your blog at least once or twice a week on topics related to your website. Blogging will help your search engine rankings and open up the communication channels between you and your visitors or customers, encouraging them to interact with you and give them a reason to return to your site in future.

If you don’t have your own website and are looking to set up a blog quickly and easily I recommend opening a free account with Blogger. You can blog about anything you like, for example a hobby, a vacation, your home town, something political, a sport or your business. Just be sure to pick something that you are interested in and knowledgeable about. You can host your blog for free on Blogspot – all you need to do is pick a name that is relevant to the topic of your blog. Once you have set up your profile and chosen a template, blogging is as simple as sending an email to a friend.

There are many ways to make money from your blog, but here are a few ideas to get you started:

- Google Adsense - this is free to join and easy to set up. The ads will match the content of your blog and you will get paid every time a visitor clicks on an ad.

- Affiliate Programs – sign up for affiliate programs related to the topic of your blog and display links to related products on your blog. Clickbank, Trade Doubler and Commission Junction are good places to start, or do a Google search for “affiliate program” + the topic of your blog to find more affiliate programs. Whenever someone clicks through your affiliate link and buys a product, you will receive a commission. If you are knowledgeable about your topic you could also write product reviews to help increase your affiliate sales.

- Sell Advertising Space – if you have a popular blog you can charge people to advertise on your blog. This could be in the form of a text link, a banner or a graphic.

You are not going to make money with a blog unless people can find it. As soon as you have started to post to your blog it’s time to start promoting it. You can get your blog noticed by…

- Submitting your blog to blog directories – just search for “blog directories” in Google

- Asking other bloggers to exchange links with you – you put a link on your blog in exchange for a link from their blog.

- Writing an article related to the topic of your blog and posting it to article directories. Remember to include an author’s resource box with a link to your blog.

- Pinging blog ping services every time you make a new post – pingomatic.com and pingoat.com are two sites you can use to do this.

- Participating in forums related to the topic of your blog. Put a link to your blog in your forum signature.

Finally, once you have your blog monetized and you have started promoting it don’t forget to post regularly. The most important aspect of every successful blog is frequent posting, so be sure not to let the virtual dust gather over your blog!

US equity markets saw steep declines yesterday, with the Nasdaq falling nearly 3% on the session. The Dow and the S&P were also both lower by more than 2% as debt contagion fears continue to plague market sentiment. Momentum carried over into Asia Pacific markets with the Hang Seng Index and S&P/ASX 200 tumbling 2.1% and 1.3% respectively. Japanese markets were closed in observance of children's day. Commodities continue to fall on renewed dollar strength, with gold lower by more than $20 from yesterday's 5-month high to $1167,and crude sitting just below $82 per-barrel.

The Battered Euro

The euro remains under considerable pressure, with single currency breaking below the 1.30 handle late in the New York session. Sovereign debt fears have all but subsided, as signs of contagion begin to materialize with yields on Portuguese, Spanish and Greek bonds rising sharply. The euro was weaker amid a choppy trading session in London, falling as low as 1.2936 before recovering to the S1 monthly pivot at 1.2990. The single currency will remain heavy with targets eyed at 1.2930, followed by the figure and our limit at the 100% Fibonacci extension taken from the Dec 18th and Nov 26th crests, at 1.2880. A breach here could lead to significant losses for the euro, with demand seen lower at the 1.28 handle. Resistance starts at 1.30 with subsequent ceilings seen at 1.3020, 1.3060 and 1.31.