In essence, Forex brokers act as the middleman between a trader and the interbanks, or network of banks, which allow you to buy and sell foreign currency.

A forex broker can retrieve bank rates and give you the best available deal. Forex traders may also be called a Forex retail broker, or a broker dealing in currency.

You can enter the market only once you’ve got a broker.

Trading forex involves making foreign-exchange-market trades involving currencies.

This may mean buying a certain currency pair, like EUR/JPY, based on the assumption that the euro would rise relative to the Japanese yen.

Alternatively, the same pair could be sold by a trader, based on the assumption that the common currency would depreciate against the Japanese yen.

In addition to making straightforward buying and selling trades, traders have several ways to take positions on currency pairs including spot contracts, forward contracts, derivatives and difference contracts.

Auto-trading is the use of computer software with no human input to conduct trading functions.

These can involve applications, such as copy trading, robots trading or automated technical analyses. You can get started with auto-trading by linking the device to your trading platform.

A Forex EA (Expert Advisor) is a computer programme which enters and exits market positions based on coded algorithms or set terms.

Scalping is a trading technique aimed at profiting from minor price shifts in small batches.

Given the enormous size of the forex industry, very little oversight exists since there is no regulatory body that can control it 24/7.

However, there are many national trading bodies around the world that regulate domestic forex trade, as well as other markets, to ensure that all forex providers abide by certain criteria.

Like any investing type, forex trading involves risk. The currency markets, much like equity, bond or commodity markets, will experience sharp fluctuations.

Investors involved in forex trading are also advised to perform their due diligence and/or consult with a qualified financial advisor before any transactions are made.

Some data suggests that ninety percent of traders lose money, mainly due to a lack of preparation, training, discipline, a lack of trading edge and poor rules on money management.