The Most Popular Currencies For Forex Investing

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The Most Popular Currencies For Forex Investing

The world of investment is one that more and more people are beginning to explore. Many of us are eager to build wealth for retirement and have money to use to treat our family or to cover those large expenses life can bring along. Of course, some individuals even take up investing as a career in order to achieve a better work/life balance and to be their own boss.

The great thing about investing in our digital world is how easy it can be. All you need is a computer, an internet connection and a small amount of cash to get started. One of the most popular forms of investment is the Foreign Exchange (or Forex) market. In the market, you place trades via an online broker on currency pairs in a bid to profit from the movement in their value. This is a huge market, with $6.6 trillion being traded each day.

If you decide to trade in forex you must be careful to pick the best Forex broker to trade with; as this will help keep your data safe and also increase the chance of you being a successful trader.

When you have selected a broker, getting up to speed with how the Forex market works and what is involved is vital. A good place to start is with the most popular currencies that traders like to invest in. These are the most popular currencies for Forex Investing.

U.S. Dollar

U.S. Dollar

Also known as the Greenback and with the USD symbol, this is the most popular currency for trading. It is also paired with all other major currencies that you can invest in. Popular pairs you can trade with the USD include the GBP/USD, USD/JPY and EUR/USD. As you would expect, forex investors need to keep an eye on the U.S. dollar due to the impact it can have on the value of other currencies. As commodities like precious metals are also priced in dollars, they can also be very sensitive to how the USD is performing.

Euro

With the forex symbol of EUR, the Euro is the standard currency used in most EU countries. This makes it a very popular currency to trade and one that is also found in pairs with other popular currencies. It is now thought to be the second most traded currency globally after the U.S. Dollar. Much of this is down to the number of people in Europe who use it but also its status as a major reserve currency. This currency is usually fairly liquid which means that any pair it is found in can be volatile. It is also a currency that is very sensitive to news around the EU– many investors use this knowledge when working out where prices may head next. Of course, Brexit is a big player in many EUR pairs at the moment for this reason.

Japanese Yen

When it comes to currencies from Asia, the Japanese Yen is still the most popular. Known as the JPY, it is heavily tied in with how the overall Japanese economy is doing. In general terms, this means investors could expect the JPY to do well if the Japanese economy is flourishing. The popularity of the Yen is also due to its suitability for carrying trading. This is where investors benefit from the interest rate difference between each currency in a pair. As Japan has very low (i.e. almost zero) rates, it makes it great for this type of investing.

British Pound

British Pound

British Pound

Also known as Sterling and with the GBP symbol, this is the national currency of the UK. It is also widely traded by many FX investors and is one of the top four that people like to put money into. A key part of this is the trust it has as a major global currency and its prevalence in many currency pairs. As with Japan, the GBP can often be invested in based on the underlying strength of the national economy. It is also quite similar to the Euro in that it often brings liquidity to any pair it is part of. This makes it popular with those looking to make bigger profits off markets which move more. At the moment, investors are having to still consider the ongoing impact of Brexit when trading this currency.

Trading the most popular currencies is wise

Why does trading the most popular currencies makes sense? In simple terms, they are easy to find with the brokers, have decent liquidity to make trading profitable and lots of information about them is available. That is not always the case with the less popular or more obscure currencies.

Lara Buck

My name is Lara Buck. A knowledgeable and qualified blogger. Here you can see my skills which gives you brief ideas on understanding all the concepts with different themes.

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