How to Become a Currency Dealer
Foreign exchange or FOREX was once the dominion of large banks, investment firms, secret hedge funds and corporations. Today, small investors are eager to learn about this once hidden market and discover how to make money using a marketplace that is not controlled by a central board, government or clearinghouse. FOREX trading allows the exchange of one currency to another currency with the exchange price based on the fluctuations in economic, political and social events as they occur, across the globe, 24 hours a day. Currency dealing is a highly competitive and risk filled income generating opportunity.
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Things You'll Need
- FOREX practice account
- Funds for training and educational materials
- Funds for membership fees
Instructions
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Study the FOREX markets and learn the ins and outs of the market, the trading process and the tools used for trading foreign currency. The time frame needed for learning about FOREX and the marketplace will vary from person to person. Learn how gains and profit are made from trading, how to manage large sums of money and how to hedge risks. If working as a professional currency dealer in a large financial institution or currency trading business is your goal, a college degree in business and possibly an MBA will be necessary.
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Practice the FOREX trading process using a practice account. Practice accounts allow users to participate in the process without actually using or losing money. Many FOREX trading businesses offer practice accounts where no actual money is used. This process also offers the opportunity to become familiar with trading software.
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Make the transition from practice to real money trades. Create a track record of good trading and implement your own trading strategy. Make trades for yourself, your family and friends. This is the beginning of your client base.
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Register as a member of the National Futures Association as outlined in the Commodity Exchange Act, if you want to become a professional currency dealer or open a currency exchange business. Find out if you qualify for an exemption from this registration and what regulations you must follow to participate as a professional in futures trading.
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Build a larger client base by opening your own futures trading business and engaging in business relationships with small businesses that are connected with overseas or foreign companies. This would include import/export companies, travel agencies and international relocation services. These companies want to receive the best price they can on foreign currency exchange for themselves and their clients.
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Tips & Warnings
Specializing in a particular pair of currencies allows a trader to develop a deeper understanding of the currencies of each country and the ways in which they fluctuate.
References
Resources
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