Posted by forex at 12:11 AM
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1. Choose a Forex broker with whom to work. There are hundreds of Forex brokers out there from which to choose. Before you choose a broker, make sure that it offers the ability to trade options. Not every broker offers this as a standard feature. You will need to fill out an application and provide identification before you can open an account.
2. Fund the account once you are approved by the broker. Each brokerage offers its own set of funding options. For example, you could fund the account with a bank wire or with a credit card payment. Some brokers also accept third-party processors like PayPal or Moneybookers as well.
3. Download the trading platform software to your computer from the broker's website. Most Forex options trading takes place online through a trading platform. Once you place an order, it is automatically processed through the broker's system.
4. Open a currency chart on your platform. You can typically access all of the popular currency pairs that are traded in the market. Once you have a chart open, you can typically place an order for an option right from the chart. Some programs allow you to right click and select 'New Order' to place a trade. There may also be a button at the top of the screen to generate a new order.
5. Use the option to provide you with the opportunity to buy or sell the currency pair at some point in the future. Depending on the type of option that you use, you typically have a certain amount of time to buy or sell the pair after you open the order. This lets you speculate on the price of the currency pair without actually opening a trade. This way, if you are wrong about the price movement, you have lost only the price of the option. If you were right about the direction of the market, you can buy or sell the pair at the earlier price and then make a profit.