People want to make money online. And “what is forex?”, is a question that many would ask on that quest to find legitimate success on the internet.
I am on that journey myself and it is one journey everybody out there on the internet, in search of livelihood. Should embark on.
It is full of both sad and happy experiences. But no matter where your first steps may take you to.
Forex is that financial journey that can help you escape POVERTY! All you have to do is Learn How The Market Works.
What Is Forex?
Forex of FX is a short term for the foreign exchange market. It is a global, over the counter (OTC) financial market where currency traders, investors, institutions and banks, speculate and trade on world’s currencies.
In this market, the main activities are centered round traders, investors, institutions and banks, knee deep in the business of Buying and Selling Foreign Currencies.
It is basically the business of converting one currency into another with the aim of making profits from the exchange.
It is a 24 hours, five days a week market. It is considered one of the largest financial markets. Averaging a daily trading volume of more than 6 trillions dollars.
It is a decentralized global market anyone from any part of the world can partake in.
What Is Forex To The Layman?
Despite the fact that the ordinary man on the street would claim ignorance when asked the question “what is forex?”
Almost everyone of us that buy and sell on the internet partake in the forex market.
The major difference is, some do it indirectly while others do it directly with the intent of making profits, directly from that interaction.
Let me explain.
Assuming you want to pay for services online. You are in Nigeria while the vendor is somewhere in the United States.
You will have to pay for the services in Dollars. But as an ordinary Nigerian, with access only to the Nigerian currency.
The next move would be to convert your Naira to Dollars. A process that would be automatically carried out by your bank.
All you have to do is click Pay on the vendors site. That is after, inputting your card details.
The conversion is then carried out based on a stipulated exchange rate.
One Dollar to Naira is currently 384 Naira in banks while it sells for around 465 black market.
When you finally do pay for the services by allowing your bank carry out the conversion, you have actually participated in the forex market.
You just succeeded in Exchanging two Foreign Currencies. You exchanged the Naira in your possession for Dollars.
Forex For The Nigerian With Family Abroad
Another ordinary Nigerian has a family member abroad that sends him Dollars directly to his domiciliary account.
Whenever he wants to spend his money here in Nigeria. He makes withdrawal in Dollars and take the American currency to the black market where the exchange rate is higher than that of the banks.
He sells it for 465 a dollar instead of the 385 that his bank would have bought it, directly from him.
Making a profit of a few thousand Naira, from just minutes of participating in the Forex market.
What Is Forex For Rich Nigerians?
Forex for rich Nigerians is a different ball game altogether. They participate in foreign exchange, so as to protect the value of their wealth.
In order to do this, they convert their money into Safe Haven Currencies. And the Dollar being one of them. Is the favorite of Rich Nigerian’s.
According to DailyFx.
“Safe-haven currencies are currencies that tend to retain or increase in value during times of uncertainty and market instability. Safe havens tend not to have a correlation with the performance of stocks and bonds, making them ideal for trading in the event of market crashes.”
The Nigeria Naira looses it value all the time. And we have seen the Naira fall multiple times in the past few weeks.
It is therefore not financially logical to have the Naira as the measurement of one’s financial value.
In fact the way the Naira is messing itself up due to our bad economy, many are predicting that in he near future, it would be $1 to 1000 Naira.
For these rich Nigerians, Forex is a means through which the value of their wealth is protected.
The Forex Market affects everyone. The moment you decide to go for a foreign service or imported product, you will have to change your own country’s currency to the currency of the location behind that service or goods.