Forex is a market for exchanging one currency for another. A position rises or falls in value as the relative price of the two currencies changes.
Before using a live account, understand the size of the position you are taking and the amount you could lose if the market moves against you.
Forex trading uses currency pairs
Currencies are quoted in pairs such as EUR/USD. Buying or selling a pair is a view on how one currency may move relative to the other.
The quote and base currency, contract size and available instruments can differ between brokers.
- Check the pair and contract specification
- Confirm the trading hours for the instrument
- Use a demo account before placing a live trade
Profit and loss move with price and position size
The same market move has a different monetary impact depending on the size of the position. Increasing size increases both potential profit and potential loss.
A trade can be closed by the trader, by an order, or by a broker's margin rules. Those are different mechanisms and should not be confused.
- Know the value of one pip for the position size
- Decide the maximum loss you can accept before entering
- Do not treat past price movement as a promise of future movement
Start with the mechanics, not a prediction
A broker account is a tool for accessing markets. It does not remove market risk. Compare account conditions, funding methods and the legal entity shown during registration before depositing.
Frequently asked questions
Q. Can I start forex trading with a small amount?
A. Minimum deposits and contract sizes vary by broker and account type. A smaller deposit does not remove the risk of losing the money you deposit.
Q. Does a demo account use real money?
A. No. A demo account is for practising platform functions and order placement. Execution, pricing and emotions can differ from a live account.
Sources and conditions
FX Textbook is edited from official platform documentation, broker-published information and applicable terms where available. Account conditions, services and rules can change. Confirm the current terms in the broker's registration flow before you act.
FX Textbook is an independent information site, not a broker or provider of personal investment advice. Forex and CFDs involve risk. You may lose some or all of your invested capital. No trading result is guaranteed.
NEXT STEP
Next: compare broker conditions
Once the basic mechanics are clear, compare account types, platforms and funding conditions before registering.