Whenever you turn to the financial pages of a national or regional newspaper, you might find that there’s a small graphic detailing the exchange rates of different currencies.

What you may or may not be aware of is that there are a growing number of people who trade on whether currencies will rise or fall in value against one another.

This is called Forex trading, and companies such as City Index provide the necessary tools to get it done from any device with a reliable internet connection.

How Does Forex Work

How Forex trading works is that you can trade on whether one half of a currency pair e.g. US Dollar/Euro will rise or fall in its value against the other half.

If you want to trade on a rise in value, then you should buy or ‘go long’.
On the other hand, if you think the reverse will happen, then you should sell or ‘go short’. The fact that, with Forex trading from City Index, you could make money whether the value of a currency rises or drops makes it more attractive than other forms of trading.

Leveraged Products

When trading foreign exchange, or Forex for short, you should be aware that it’s a leveraged product, which means that you only have to deposit a small amount of the money you wish to trade (between 1-10% of the total amount you wish to trade with).

This also means that, if you’re in profit, you could actually make more as the total money you wanted to deposit rather than the small percentage is multiplied in the number of points it rises or falls in your favour to give you your total profit. This alone is what makes Forex trading so attractive to more people than ever.

Here is a 60 second video from City Index explaining Forex Trading.