The newcomer to forex may ask, "what is forex short for?" Quite simply, it is an acronym for FOReign EXchange; it takes the first three letters, "for" from "foreign," and the first two letters, "ex" from "exchange" to become the familiar name of forex. Foreign exchange is sometimes also shortened to simply FX, but more often than not it is referred to as forex.
Foreign exchange describes the differences in the worldwide currencies that can be traded, one against the other. For example, a weakening British pound may be traded against a strengthening American dollar.
The stock market is the other well-known market that can be traded. In this market you purchase shares of stock, whereas in the foreign exchange market you purchase currencies. Currency is bought in packages called Lots, sometimes also referred to as Contracts. A Lot or a Contract has a face value of $100,000.
You can of course trade in forex without knowing the answer to, "what is forex short for," but you can't really trade successfully without knowing what's going on. Currencies are purchased and sold again in pairs. Each currency is identified by three letters. The first two identify the country, and the last letter identifies the currency used in that country.
Two currencies are listed in every trade symbol. The first currency to be listed is the one that is being bought or sold. The second currency to be listed is the one representing how much you are paying for it once it has been converted to that currency. Trade symbols are written as in this example: USD/GBP. The first currency is the United States Dollar, and the second currency is the British Pound (Great Britain Pound).
What is forex short for? You could say a lot of money in the bank if you are successful in your endeavors. Forex has become one of the more popular ways to earn money online in recent years. However, its apparent simplicity covers up a great deal of complexity that can trap the unwary newcomer.
It's a sad statistic that around 95% of all newcomers to forex fail and lose all their money. You could say that the answer to, "what is forex short for," in this case is total loss. Most of the 95% of losers would probably agree too. However, closer examination reveals that the majority of the people who lose out have gone in to forex totally unprepared.
Most of the forex brokers provide their clients with demo accounts. This allows the learner to play the forex game without using real money. It may not be exactly the same as the real thing, but it certainly comes close. The beauty of a demo account is that you can practice for days, weeks, months even.
Few of the people who lose bother to practice properly. They may spend a day or two practicing, and then gold fever grips them and they are off placing trades in a haphazard way. What is forex short for? In this case it is short for, "idiot."