There is a lot of confusion in people’s mind that how to start forex trading in India, can we do with the same trading account or we need some different account.
Trading in a foreign currency called forex trading. The currency prices fluctuate like stocks. Investors buy the currency or sell it in the short term and long term and make a profit out of it.
And its legally allowed to trade within Indian Exchanges like BSE, NSE, MCX as per RBI guidelines, it’s done in currency pairs. And if you do trading with brokers who have membership in mention exchanges, it is absolutely legal.
All the trade you need two accounts, a trading account, and a bank account to start forex trading in India.
And if you are a complete beginner and want to start forex trading in India this guide is for you.
How Forex Trading Works
The buying and selling of a currency for making money are called forex trading. These days the process of buying and selling complete online. Have you buy or sell stocks sometimes it is same like that.
Have you noticed in past few years the dollar rate constantly increasing if you would have signed only $1000 contract suppose you have bought it at 60 and now it’s at $75 you could make $15000 so you can imagine? Like shares you can square off here also means short sales.
But You Should Consider Some Factors Before Opening a Forex Brokerage Account
You must check leverage, leverage is the term through which you get an X-margin against your actual amount.
Forex brokerage houses provide a 50:1 or as high as 300:1 ratio. The leverage allows you to make a large amount with a small amount. You also be cautious while placing an order because when it goes wrong you bear the loss.
You should be aware of the fact about the higher the leverage, the higher is the level of risk involved. The brokerage houses put automatic filters to prevent your account to go negative or in simple words to minimize your risk.
You know what is forex trading deals directly with market makers not through brokers, so you don’t pay fees on every trade you make.
It differs from firms to firms, the difference could be small but in large volumes, it can create a significant difference.
You can check the spreads on currency pairs offered by brokerage houses.
What Are Other Factors That You Should Keep In Mind while choosing the forex brokers?
You can check the factors like how much is their charge, how much support they are offering to their client, training.
Regulated market participants required to follow the rules and minimum capital that should follow the benchmark standards so that healthy trade practices can follow, check the reputation of the company and background so that you can choose the best.
Best Forex Broker In India 2020
You can start trading with register Indian forex trader.
Iforex is the most reputed and largest Forex trading platform that supports web-based as well as a mobile trading platform.
The best part of it is you not need to pay anything while opening a position. iForex charge between the buy and sell rates which is charged by all the Forex trading platforms.
It offers you 90 currency pairs to do forex trading through this broker. You get an amazing education package one on one training facility and support.
Other houses are
- SBI FX Trader
- Lite Forex
- Nord FX
How to do Forex Trading
The process to be followed for doing forex trading in India is given below
The first step to do forex trading is to decide in which currency pair you want to trade. The currency pair could be USD/INR, EURO/INR, GBP/INR, JPY/INR these are the few pairs that are permitted by the regulatory authorities like SEBI and RBI.
Give some time to the market analyze the things on a daily basis, and watch the market where it is going its need to practice not required a lot of money to practice. you need to be patient here.
List of commonly traded pairs
# 1. The second step is totally up to you how much money you want to put to trade, For beginners, it’s recommended that keep the size small because you are in the learning phase. And in the learning phase, we always keep the amount small.
# 2. Choose your broker this is a one-time groundwork before choosing, always choose the broker with fewer fee charges on the trading amount and good track record, supportive team, and with other benefits.
# 3. Now, this the final step where you choose in which currency pair you should buy USD/INR, after some market analysis you see the USD going up and up then you can opt for buying USD, which could be profitable for you in near future.
Things to Consider Before Starting Forex Trading
You always keep in mind that forex trading a risky business, to master it, it needs training and practice, if you are new in the game always try to keep the trading amount short and never do this job with borrowed money.
Choose a broker wisely, there are fake or unreliable online brokers. Before choosing to scrutinize them, their presence and track record, their charges, trading platform, and trustworthiness.
In the initial days, you should focus on a single currency pair, after some experience and expertise over the field you can try other pairs as well.
Always start forex trading with a small amount after grasping the overall things you can increase the amount at any time.
Also read: high-income skills to make money online
Advantages of Forex Trading
It can be done 24×7 its totally online with internet connectivity you can do from any part of the world.
Liquidity is so high any time can be sold or bought.
It’s not so volatile like the stock market, easy to predict because when a trend starts it’s going long.
You have multiple currency options.
You can make huge profits once you master the skill from the comfort of your home.
Drawbacks of Forex Trading
This whole game risky in nature you may lose money
You always need to pay brokerage charges for doing currency trading
There are some fake brokers. You need to be careful while selecting the best broker.
Forex trading is one of the best career options which can help you earn a lot of passive income through this. If you are seriously want to make a career in it then you should take some professional training before starting your new career option. This is the whole guide on how to start forex trading in India.