Forex trading

The largest market in the world

What is Forex trading?

Forex trading is also known as FX Trading or Currency Trading. It refers to the central marketplace where traders exchange currencies for one another at floating rates.

The foreign exchange market consists of multiple markets, including Spot FX, Future derivatives, Forward Derivatives and CFD derivatives. The Forex market is one of the largest and most liquid financial markets in the world, with a turnover reported to exceed $5 trillion per day. Forex is open to trade 24 hours a day, 5 days a week.

The most common pairs to trade are called the ‘majors’. Examples would be the EUR/USD, GBP/USD and USD/CHF.

Learn to trade Forex

How does Forex trading work?

ZERO Markets Forex pairs are traded as CFDs (Contract for Difference). When trading forex, you select a pair of currencies and base your trading decision on which currency’s price you think will rise or fall. Forex is traded in currency pairs, for example EUR/USD. The first currency is called the ‘base currency’ and the second is the ‘quote currency’. Currencies are displayed showing how many units of the quote currency you can buy with one unit of the base currency. This is the exchange rate.

For example, EUR/USD 1.2344 shows us that 1 Euro = 1.2344 US Dollars.

When you’re ready to trade you will choose to go long or short. In the example above, going long means that you think that the value of the Euro will rise against the US Dollar. Going short means you think it will fall.

Trade EUR/USD

Forex trading example

The gross profit on your trade is calculated as follows:

Opening Price

$1.33623 × 2 lot = $267,246

Closing Price At $1.32129 × 2 lot = $264,258Gross Profit on Trade $267,246 – $264,258 = $2,988

Closing Price At $1.34529 × 2 lot = $269,058Gross Loss on Trade $267,246 – $269,058 = -$1,812

Opening the position

The price of the Euro against the US Dollar (EUR/USD) is 1.33623/1.33624 and you decide to sell 2 standard lots (the equivalent of €200,000) at 1.33623.

Closing the position

One week later the Euro has fallen against the US Dollar to 1.32128/1.32129 and you decide to take your profit by buying back 2 standard lots at 1.32129; if the Euro has increased against the US Dollar to 1.34523/1.34529, the trade loses $1,812.

Trade from 0.0 pips

Typical Forex spreads

		Standard account		Super ZERO Account
Symbol	PRODUCT DESCRIPTION	MIN	AVG	MIN	AVG
AUDCAD	Australian Dollar vs Canadian Dollar	1.1	2.65	0.2	1.75
AUDCHF	Australian Dollar vs Swiss Franc	1.6	2.65	0.7	1.75
AUDJPY	Australian Dollar vs Japanese Yen	1.1	2.08	0.2	1.18
AUDNZD	Australian Dollar vs New Zealand Dollar	1.1	3.12	0.2	2.22
AUDUSD	Australian Dollar vs Us Dollar	1.1	1.66	0.0	0.2
CADCHF	Canadian Dollar vs Swiss Franc	1.5	2.72	0.6	1.82
CADJPY	Canadian Dollar vs Japanese Yen	1.2	2.24	0.3	1.34
CHFJPY	Swiss Franc vs Japanese Yen	1.1	2.75	0.2	1.85
EURAUD	Euro vs Australian Dollar	1.1	2.71	0.2	1.81
EURCAD	Euro vs Canadian Dollar	1.5	2.72	0.6	1.82
EURCHF	Euro vs Swiss Franc	1.3	2.31	0.4	1.41
EURGBP	Euro vs Great Britain Pound	1.1	1.67	0.1	0.3
EURJPY	Euro vs Japanise Yen	1.1	1.89	0.1	0.89
EURNOK	Euro vs Norwegian Kroner	5.2	47.61	4.3	46.71
EURNZD	Euro vs New Zealand Dollar	1.2	4.75	0.3	3.85
EURPLN	Euro vs Polish Zloty	1.7	22.65	0.8	21.75
EURSEK	Euro vs Swedish Krona	6.6	46.3	5.7	45.4
EURSGD	Euro vs Singapore Dollar	1.6	4.32	0.7	3.42
EURTRY	Euro vs Turkish Lira	1.6	18.45	0.7	17.55
EURUSD	Euro vs Us Dollar	1.0	1.2	0.0	0.1
EURZAR	Euro vs South African Rand	12.5	87.57	11.6	86.67
GBPAUD	Great Britain Pound vs Australian Dollar	1.6	3.93	0.7	3.03
GBPCAD	Great Britain Pound vs Canadian Dollar	1.1	3.94	0.2	3.04
GBPCHF	Great Britain Pound vs Swiss Franc	1.4	3.35	0.5	2.45
GBPJPY	Great Britain Pound vs Japanese Yen	1.1	2.47	0.2	1.57
GBPNZD	Great Britain Pound vs New Zealand Dollar	1.6	7.01	0.7	6.11
GBPSEK	Great Britain Pound vs Swedish Krona	8.1	62.82	7.2	61.92
GBPSGD	Great Britain Pound vs Singapore Dollar	1.2	6.49	0.3	5.59
GBPUSD	Great Britain Pound vs Us Dollar	1.1	1.85	0.2	0.95
NZDCAD	New Zealand Dollar vs Canadian Dollar	1.6	3.37	0.7	2.47
NZDCHF	New Zealand Dollar vs Swiss Franc	1.8	3.15	0.9	2.25
NZDJPY	New Zealand Dollar vs Japanese Yen	1.5	2.68	0.6	1.78
NZDSGD	New Zealand Dollar vs Singapore Dollar	1.6	4.92	0.7	4.02
NZDUSD	New Zealand Dollar vs Us Dollar	1.1	2.13	0.2	1.23
USDCAD	Us Dollar vs Canadian Dollar	1.1	2.07	0.2	1.17
USDCHF	Us Dollar vs Swiss Franc	1.1	2.22	0.2	1.32
USDCNH	Us Dollar vs Chinese Yuan	4	16.15	3.1	15.25
USDHKD	Us Dollar vs Hong Kong Dollar	1.9	10.94	1	10.04
USDJPY	Us Dollar vs Japanese Yen	1.0	1.2	0.0	0.2
USDNOK	Us Dollar vs Norwegian Krone	5.2	34.52	4.3	33.62
USDPLN	Us Dollar vs Polish Zloty	3.9	21.2	3	20.3
USDSEK	Us Dollar vs Swedish Krona	5.2	27.87	4.3	26.97
USDSGD	Us Dollar vs Singapore Dollar	0.3	3.8	0.1	2.9
USDTRY	Us Dollar vs Turkey Lira	1.7	11.52	0.8	10.62
USDZAR	Us Dollar vs South African Rand	4.8	65.19	3.9	64.29