Statistics from the Bank for International Settlement (BIS) put the rate of daily turnover in Forex Trading to $ 5 Trillion at the end of 2011 financial year. This certifies why Forex happens to be the highest revenue generating investment in the global currency market.
The rate of turnover in Forex makes it an attractive business despite the high risks involved. Trading the Forex market successfully requires good skills, experience, and efficient trading tools.
For an investor who wishes to start Forex, the following essential materials listed in the table below must be acquired.
M = minimum; U = upwards; O = optional; N = novice; E = expert; I = intermediate; ** = must
1. Fund **
This is an investment business which involves buying and selling of contracts, therefore funds are the most essential. However funds required for Forex goes beyond the trading funds. You need extra funds for purchasing other materials like the ones listed below.
2. Computer ** (Laptop or desktop) laptop is preferred for mobility reasons.
A minimum system specification with 1.7GHz ( u ) processor speed, 2.0GB RAM ( m ), Win XP / Vista / 7/8 (latest OS preferred), 15 “screen ( u ) for better view, high Audio / VGA & Accelerator Cards, 3 USB Slots ( m ), 150GBM hard disk space.
Forex requires very good computer processing power to handle multiple charts efficiently and other day-to-day tasks. Adequate hard disk space is essential not just for the trading platform but for storing trading video files, tutorials in audio and document formats, history files, and other Forex materials. Slow trading platform performance, platform crashing and freezing are sometimes caused by low computer resources.
A single computer system is sufficient for Forex Trading. However multiple screens or PCs is recommended for those who wish to simultaneously monitor several platforms, use advanced charting tools, and view multiple accounts.
3. Internet **
This is an important material needed to trade the Forex online. A single Internet provision may not be particularly favorable for regions with erratic or poor internet connectivity. Wireless internet connectivity is preferred due to mobility, and wide variety of options.
The Internet LAN option comes with some disadvantages but the connection speed is fairly better than wireless internet connections. Proxy configurations and firewalls are the key issues with LANs in a corporate network. Most Forex signal services and EAs do not work efficiently with Proxy Connections.
4. Forex Trading Tools **
This goes further than the tools you'll find in your regular MT4, MT5, or TradeStation trading platform. Find below categories of Forex trading tools:
Forex Analyzing Tools – required to analyze trade results & setups. eg spreadsheet apps.
Forex Charting Tools – needed specifically for drawing trade setups and analyzing pre and post trade events.
Forex Simulation Tools – very essential for designing trading strategies, perfecting trading strategies, analyzing past trades, test trading systems and strategy offers, etceg Forex EA Analyzer, Strategy Tester, etc
Forex Utility Tools – as the name suggest you need them to ease your trading experience. Eg timers, world clock, etc
Forex Trading Tools – custom indicators, scripts, supplement chart tools, EAs, news tickers, etc
5 Smartphone ( o )
This is required for business enthusiast who are always on-the-go. Most Forex services and platforms are now supported on smartphones
6. Satellite / Cable TV Network
This is a must for those who love the fundamental approach in trading Forex. You need this to get yourself updated with economic events in the world. There are mobile gadgets, which have satellite television, and streaming news capabilities. You can also install satellite television services on your computer or sign up for online Forex live news.
You need this device to print monthly statements, Forex software guidelines, trade results, training materials, etc
Some of the items listed above are optional but are essential for starting Forex, while some are more useful for advanced Forex traders.
However ensure you get some of the materials listed on item 4 (Forex Tools). Do not compromise with item 1 (Funds) else you'll find yourself gambling rather trading.