Perfect Guide For Anyone Looking To Start Online Trading In Canada

By Swindon Link - 28 June 2021

Features

Forex, or currency exchange, is the process of buying and selling different currencies and is one of the world's largest financial markets. It can be a lucrative trade, but it can also be relatively risky if you don't know what you are doing. Getting yourself acquainted with some of the fundamentals of currency conversion is the first step if you decide to give it a try.

Forex markets are the most significant financial markets in the world. It is a global market in which currencies from around the world are traded. Every day, 24 hours a day, the Forex market is open. The Forex market is an integral part of the global financial system. 

 

Trading In Canada

As previously mentioned, each country has its individual regulations for trading Forex, and Canada is no different.

Regulation

Regulation of Forex trading in Canada is under the control of the Investment Industry Regulatory Organization of Canada (IIROC). Generally speaking, Canada is investment and trade-friendly, as is noted with its relaxed crypto trading regulations. This is beneficial to Canadian traders because it means you have more freedom to trade as you see fit.

Brokers

Before you can trade, you need to find a reputable Forex broker to execute the trades on your behalf. Some of the main things to look for are regulation, security, transaction fees, and the level of protection offered by these companies. It's a good idea to do your research before searching for Forex Brokers operating in Canada, as each has its particular pros and cons. Brokers also differ in terms of security features. Brokers may implement security features for customers to keep their account information safe from hackers. Some of the more popular choices include:

 

  • FXTM

  • Alpari International

  • GO Markets

  • Easy Markets

  • CMC Markets

 

It is vital to engage in due diligence and know what you are looking for regarding features when choosing a broker. Some things to be aware of when selecting a broker includes:

 

  • Compliance with regulations: You should ensure that the broker is compliant with IIROC regulations. You can often find this stated in the footer of the website or on their about page.

  • Features of an account: Features don't always equal better, but they can simplify things when learning something new.

  • Pairs of currencies offered: Despite a Forex broker offering an array of currency pairs, what matters is the flexibility to choose the ones you want.

  • Customer Service: If you are trading at any time of the day (which isn't unheard of in Forex), you will want customer support 24/7.

  • The trading platform: Make sure the broker you choose has a trading platform and software that allows you to perform analysis and enter and exit trades quickly.

What Is Forex?

For those who are unaware, Forex is the abbreviation for Foreign Exchange. This term is continually heard, but what exactly is Forex trading? The simple answer is that it's a global market for trading currencies. The past decade has seen even more growth as the volume of traded assets has continued to increase. As a result, the market size of Forex trading now exceeds the combined value of all the goods and services sold annually.

Types Of Forex Trading

The overall Forex market is composed of three types of trading. Therefore, before making a decision, you should be knowledgeable about the differences between the three types. 

 

 

Spot Market

Spot trading is a way of trading currency without holding them for an extended time. The idea is that you can deal quickly (within seconds) and that you can buy and sell in a single transaction. It is the most prevalent form of trading and typically involves the buyer and seller agreeing on a price on the spot and then executing the trade. 

Forward Market

In this example, it's not the currency traded but rather the right to buy the currency. The forward Forex market involves the exchange of forwarding contracts between two parties whose objective is to acquire foreign currencies at a fixed price at a future date. It is more complex than spot trading but worthwhile for other reasons.

Futures Market

Futures trading is a way to speculate on future prices of commodities or financial instruments 9like currency). In anticipation of purchasing or selling a futures commodity or financial instrument, futures traders buy and sell contracts to make money when the future is delivered or when the contract expires.

 

Benefits Of Trading Forex

For the average person, the benefits of trading Forex are numerous. Most notably, you can make money, and the thrill of trading makes it extremely exciting. Some of the main advantages include:

 

  • It is a vast, global market: Trading on the Forex market can be a fascinating experience because it is a worldwide market.

  • 24 Hour Trading: Following on from its enormity, the fact that it is global means that trading never ceases, and you can trade whenever you like.

  • Transaction costs are low: Novice traders can benefit from the low barrier to entry. You only need a small initial capital to get started, and the trading fees are very affordable.

  • Beginners will enjoy it: Due to the ease of entry and initial low risk, it is accessible for beginners.

  • Utilize leverage to your advantage: Leveraged trading is one of the most compelling reasons for trading Forex since it allows you to open a significant position with relatively little capital. This is great for those starting on their Forex journey.

  • High Liquidity: The Forex market has a global scope and a large volume, making it one of the most liquid on the planet. Hence, your assets can be easily traded even if their value varies slightly.

  • The industry is well regulated: Since there is no centralized exchange system, every country has its regulations. This is beneficial because there will always be a governing body that makes the rules and keeps things stable.

Forex trading is a fun and exciting activity to participate in and can earn you serious money if you play the game correctly. Trading in Canada is no different from trading in most parts of the world, except they have their own regulatory body.

 
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