Forex Margin Trading
Forex Margin Trading occurs when a trader puts only a small amount of money to control a larger amount of currency. In the video we show a live example of Forex Margin Trading. In the trade we have bought 2 lots of EUR/USD which is the amount you will find in the size column. The 0.20 amount represents 2 mini lots or 20,000 Euros. Given that our trading account is in US dollars, to buy those 20,000 Euros we had to sell 24,204 US Dollars.
This is because at the time we bought the Euros the market price was 1.2102. This means that at the time of purchase one Euro was worth 1.2102 US Dollars, and therefore to buy 20,000 Euros we had to sell (20,000 X 1.2102) 24204 US Dollars. But here is the cool part ! Forex Margin Trading allowed us to buy 20,000 Euros with only 1% of the 24204 US Dollars!
CLICK HERE TO WATCH THE VIDEO ON YOU TUBE !
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