What is Currency Trading?
When you trade a currency pair, you enter into an agreement to trade a derivative based on an foreign exchange pair. The value of the trade shifts over time as the market rate for the currency pair changes. You realize a loss or gain at the time you close the trade.
The dealer charges you a different rate depending on if you place a long or short trade, and again when you close the open trade. When you long a pair, you are charged a higher rate: the Ask rate. When you short the pair, you are charged a lower rate, the Bid rate.
To learn more about Currency Trading, please visit the OANDA Academy at OANDA fxTrade.
DISCLAIMER: Leveraged trading in foreign currency contracts or other off-exchange products on margin carries a high level of risk and may not be suitable for everyone. We advise you to carefully consider whether trading is appropriate for you in light of your personal circumstances. You may lose more than you invest. Information on this website is general in nature. We recommend that you seek independent financial advice and ensure you fully understand the risks involved before trading. Trading through an online platform carries additional risks. Refer to our legal section here