Leverage is at the heart of Forex trading, as currencies vary only by very small amounts, moving perhaps a fraction of a per cent a day in a currency pair such as the EUR/USD or USD/YEN. So speculators introduce huge leverage into this market in order to increase potential movements, and essentially magnify the small fluctuations.
This high leverage availability coupled with great liquidity has created a Forex trading system that is hugely attractive to traders, and has accelerated the markets exponential growth. Positions are able to open and close very fast, but can also be held open for months at a time. Some of the most attractive features of the Forex trading system are that even the very biggest players cannot manipulate or influence the market as they choose because it is simply so vast; there are no monopolies; currency fluctuation information is available publicly to everyone, so there is no chance of any insider dealing going on. Basically, FX trading is a totally level playing field for big and small players alike.
Currency trading is basic to the global economy, as currencies need to be converted back into native types following the sale of goods on foreign markets, and as they are no longer pegged in any way there is great scope for speculators, who in fact make up 95 per cent of the Forex market traders.
Forex trading software is widely available to help the budding trader learn Forex, and there’s even software like MetaTrader that does the market analysis and trading for you.