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Forex Trading in South Africa in 2021

Exchange of foreign currency through market is now a days, a very popular and useful mode for trading. Currencies of different countries may be exchanged through this platform. In this exchange process, two different currencies are involved. The mostly traded currencies are EURO and USD. Generally the EURO exchange rate is slightly higher than USD. These two are the most common pair for forex trading in European, Latin American countries. Forex market has important financial hubs in different countries across the world. They are spread over Singapore, New York, South Africa, Tokyo, Landon, Hong Kong, Zurich, Frankfurt etc.  

Forex Trading

Nowadays, amongst the fastest growing industries in South Africa, Forex Trading has become the front runner. South African currency is known as Rand and its Trading name is ZAR, in short termed as R. Since 2004, the Rand has been one of the top twenty currencies across the globe. Forex trading has both merits and demerits. It is a platform for the people who are thoroughly aware of the procedures, may earn hefty amount of profit. But for the newcomers, who are not fully aware of the systems and are not fully conversant with the tricks of trading, when and how to invest may lose their investment.

Previously, currency trading was mostly confined amongst the large multinationals or corporates. But, with the introduction of internet, attempt was made to involve the individual traders by creating a retail market for trading. Forex Trading is the latest platform in this respect.

Forex in South Africa 

In South Africa, ample scope is there for the beginners to trade. Individually, the traders may have the access through banks or there are brokers and dealers who provide best leverage, so that they can trade with minimum amount with high gain.

Forex being the largest financial market around the world, it is a competition that needs proper preparation and solid infrastructure to be in the game. To start:

  1. Connect online: A strong internet connection is required so that there is no delay in the system since the Forex trading is a game of accurate timing and any delay in connection can mess up a perfect strategy.
  2. Search for a good Forex broker: Though Forex brokers can be connected easily from anywhere of the world in today’s technology, but their governing body should be scrutinised. South Africa generally provides strong protections but they may not be applicable in case of an offshore broker.
  3. Opening and funding an account: As directed by the broker, a process should be followed for opening the account and the KYCs to be submitted properly for connecting the bank account. Trading can be started with virtual money, but if one wants to make real money out of it, the account is to be funded. Funding is easy, if the bank account is connected, but it can also be done with cheque, debit card or credit card.
  4. Trading platform: Reputed brokers are generally attached to proprietary platforms for trading. This platform is the interface for the users to make investments in the market. FOREX.com, FXTM & AvaTrade are some of the best brokers in South Africa.

An example of Forex trading: Hypothetically if assumed that ZAR /USD is being traded at 0.05780 /0.05790 and the price will shoot up. The rate of margin for this pair of currency is 3.17% and if one wishes to buy R150,000, one needs $275.08 only in one’s account; one can borrow the rest of the amount with the help of the broker. The price of the ZAR/USD escalates as per plan. Its trading will be 0.06020/0.06040 after about three hours. One will have a 23 points move (0.06020 – 0.05790) and one’s gain is (R150,000*0.06020) – (R150,000*0.05790) or $345. 

PS: Exchange rate fluctuation of currencies depends on their demand and supply. Also other external factors may influence the fluctuation of the rate of currencies. They may be natural catastrophe, political events, economic trends etc. 

ForexSignals.com is one of the top rated platforms and is the host to mentors with nearly 80 years of experience. One can be helped with decoding of real-time live streams with the help of trade signals, market analysis etc. A lot of personalised tutorials, workshops and educational videos are also provided.

Conclusion

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Considering all the above points it is ascertained that at present, South Africa is one of the best hubs for Forex trading with ample scope of revenue generation and establishment of the business. Last but not the least; trading should never be done alone. 

 

I am a simple girl who loves to write and play football. My interest towards writing has made me write a lot of eBooks and short stories. I believe writing is that passion which helps you connect with your readers.

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