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What is Forex Trading

Forex Trading

Forex or foreign exchange is the speculative trading on the movement of an exchange rate between two currencies. If say £1 is equivalent to $1.6 then the exchange rate of GBPUSD will be 1.6. If you believe that the US economy will grow stronger than the UK then you could place a forex trade that the exchange rate will drop and if it does then you will make a gain, if it goes against you then you will make a loss.

Forex market makers will quote exchange rates down to either 4 or 5 decimal places. I.e an exchange rate of 1.6 for sterling against dollar could be quoted as GBPUSD 16000.

A movement of the 4th decimal place in known as a pip. When you place a stake on a Forex market your stake will be multiplied by each pip movement. So if you buy a forex trade with a stake of £10 in GBPUSD with a price of 16000 and sell at 16010 then you will make a gain of £100.

Note however, that there is a buy and sell spread price so you will lose some of your gains to the spread. See our Forex guide for more details on this.

At 3DMarkets we quote exchange rates for over 37 currency pairs covering major and minor currencies.

Why is Forex the most popular spread betting market?

  • 24hr trading. With no stock exchange to limit trading hours, at 3DMarkets we can offer you trading throughout the whole day and night from Sunday evening to Friday night.
  • Tight spreads. Forex is a very competitive market place and therefore the spreads are some of the tightest across all the markets. Our spreads start from 0.8 fixed. To see how this compares take a look at our forex company comparison guide.
  • Tax free. There is no capital gains tax to pay under current UK tax laws. And unlike shares there is also no stamp duty to pay as you never own an underlying asset.
  • Instant returns. Whatever gain or loss your position is at, when you close the trade your account balance is instantly updated. There is no need to wait a settlement period before you see your returns.
  • Truly global markets. Investors across the world are trading the same price without the need for a single exchange to support the price.
  • Price volatility opportunities. A wide range of factors can influence the Forex price: economic performance, political stability, central bank announcements, national level events, impacts on dependent countries and of course, sentiment. The resulting volatility in prices creates trade opportunities for those who want to take them.

What platform do I use?

The 3DMarkets Forex platform is available on web, mobile or download. This one platform also supports spread betting and CFDs if you wish to trade other products.  See our forex platform guide for more info.

How do I get started?

Click on Live account and complete the application form. We aim to complete all account opening within 24hours and you will receive an email confirmation with your account details.

Then choose which platform you want to use and download the 3DMarkets app if required. Login, fund your account and away you go.

Open a Live account     NEXT: The Advantages of Forex


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3DMarkets Trading is a trading name of Spread Co Limited, who are authorised and regulated by the Financial Conduct Authority. FCA Registration Number 446677