I had been playing around with the fxcm practice forex account for about a month, they give you 5,000 in fake money and in that month I made 15,000 in profit so I thought it was time to take the plunge and start investing real money. So yesterday I opened a mini account with the minimum $300. I didn’t want to put too much into it since this was my first time and that was both a blessing and a curse.

I short sold usd/jpy and bought eur/usd and got knocked around big time. You could make some good money starting with only 300 in your account but it is really hard because one you have to trade small amounts to not risk a margin call when a large unpredictable change happens so forget long term trading with only 300 dollars. Based off my trading so far, I would say to have a minimum 100 dollars for every 10 dollars you trade. Otherwise you are going to be annihalated by one erratic shift in the short term market.

I f you are interested in trading forex, before you start an account definitely go through the entire “school” at babypips.com and trade with a practice account for at least a month before opening a real account. Also be sure to have a large amount of disposable cash you can commit before beginning otherwise you are just going to be throwing away money.

What is Forex?

Forex is simply an abbreviation of “Foreign Exchange Market” and is simply the market for exchanging currency’s. Unlike stocks though there is no central exchange, instead all exchanges are done over the counter through brokers and dealers. In simplistic terms, Forex is me giving you x amount of usd in exchange for an agreed upon equivalent in whatever currency you have.

How do You make money off of Forex?

You make or lose money by trading in the Forex market by taking advantage of the fact that the values of currencies are dependent on the percieved economic strength of the country that prints that currency. So while 1 usd(US dollar) may get you 1 euro one day, if the United States economy drops or Europes economy increases, you may only be able to purchase half euro for each usd the next day. So you would make money by trading a strong currency for a weak currency that you believe wil become stronger at a later date.

Heres an example, (keep in mind this is a fabrication to help you learn)

• Year 1:You buy 1 million Iraqi Dinars for 10 US dollars.
• Year 2:Event happens like US takes over Iraq(1millionID/usd, hold cause you only lose money if you sell)
• Year 3:US establishes a stable government(500kID/usd, hold cause 50 bucks isnt much profit)
• Year 4: Iraqi economy stabilizes, You sell your 1 million Iraqi Dinars at a 1kID/usd exchange rate for 1000usd(990 in profit or a 1000% returns)

What you should have learned from that example is that the currencies of stable countries dont usually fluctuate greatly each day, its more of a gradual increase or decrease spread over months or years. Unless a large economic event happens.

What cause the currencies value to change?

Since it is an OTC market the exchange rate will change based on the percieved economic strength of the currencies being traded. Meaning just about anything could cause a change in the rate of exchange. Here are a few things though you should keep an eye on if you plan to trade Forex.

• Look at past changes and what was in the news at that time
• Unemployment Rates
• GDP of the countries
• Interest rates
• Actions of the Central Banks
• Major News stories i.e. government dissolutions(see Putin) or major scientific undertakings(see China)

Just keep in mind that the exchange depends on the values of two countries currencies. So if you buy euros thinking the usd will drop because of say an oil embargo or some other event, it does you no good if the euro also drops because of the predicted event. In otherwords remember to keep your eye on both the countries whose currencies you’re working with.

How do I find people to trade with?

Since its an over the counter market and most of the exchange volume is done by large banks, you probally will have to either go through a bank or a broker/dealer company. I have yet to try any of the big forex trading companies but I plan to give them a shot so I would greatly appreciate any recommendations to trading companies you prefer.

The Best Forex Guide OnLine
Thanks to Jaswilli77 on DP for recommending me the site babypips.com. If you are looking to trade Forex I would recommend going through their “school” it doesnt cost anything but time and teaches you in a language a baby could understand.

There is a bit more information in relation to the actual process of exchanging and there will be a “How to trade Forex!” post once I’ve lost or gained a bit more money with Forex. I am even more interested in Forex now that the US dollar is so weak cause I’d like to take advantage of that to gain money instead of continue to loose money as a result of it.

Disclaimer: All information I post is what I believe to be true but I am not an account or a trained financial advisor and Forex just like stock is not a sure thing. You can lose alot of money so before you spend any money or do anything consult a professional financial advisor.

What is Mint?

According to the people at Mint.com…….

Mint is a modern, powerful, easy and secure web-based solution for managing your finances. And it’s free. You register anonymously using any valid email address, and then add the log-in information for the online bank, credit union and credit card accounts you want to consolidate in Mint.

That basically sums it up, they consolidate all your accounts that have an online portal, they have over 3,500 instituations in their database, and display it on your mint account in a easy to read fashion.

Spending Trends

Besides telling you how much or how little you have in your accounts, Mint will tell you how all your money is being spent. Mint places all your spending into categories like restauraunts, shopping, gas, entertainment, groceries and more and displays it in bar graphs and pie charts, so you know exactly what percent of your money is being spent on gas to fill up that suv of yours or how little in my case is being spent to fill up that Ninja.

Ways to Save

Another cool feature is Mint will analyze your spending and your accounts to find you offers that will save you money. For example if you have a checking account that is not earning you any interest, Mint will suggest an interst yielding checking account from say ING. There are also offers for monthly bills, credit cards and general offers.

Also this is where Mint will be making their money. For each time you switch to another bank on their recommendation, the bank will pay Mint a fee. I was worried at first that Mint may recommend products just to collect the affiliate fee but after using it, I believe they are only going to recommend offers that will benefit the user.

Are they Safe and Secure?

They are about as secure as a website can be, there servers are guarded 24/7. They use Yodlee to connect with the financial institutions. The same company that Bank of America, Fidelity and Microsoft Money use. They hack their own site constantly and have been verified by verisign. Read more about Mints security practice’s.

Phenomenal Finance Blog

On top of now having the best online based Financial Manager, Mint also has a very extensive blog on finance containing some of the best articles and tips on finance Ive read in a while. Heres just a sampling of the more

• six-steps-to-teaching-your-children-better-money-skills
• Be Savvy with Credit Card balance transfers
• True Cost of an Iphone, Cars and other things you dont know about
• My Mom stole my Identity
• Stash your Cash at the right places

Disclaimer: I dont make a dime from talking about Mint, I do it because they have kept my finances minty clean and I think they can help keep your finances clean to.