Now, this is NOT how you make money in the Forex Market. Traveling to another country is actually a small percentage of the overall transactions in the Forex market. That was just an example I wanted to show you guys on what Forex is like in real life. TRADERS would make money in the Forex Market is they PREDICTED that the currency value of the United States would be stronger in comparison to the Great Britain pound in that exact scenario. Physically trading for a profit (speculating) actually makes up most of the overall currency transactions! It’s as simple as that!

Now, you’re not just predicting randomly. You are NOT just guessing and hoping for the best as you would in Vegas pulling a slot machine. There are many factors that can help you make a confident decision on determining which currency pair will be stronger against the other, but we’ll discuss that a little later. Simply put, you can make money in the Forex Market by: accurately predicting if one country will be stronger or weaker than the other. Unlike stocks, you’re able to SELL if you think something is bearish (heading down), and if you’re right, you make a profit!

Consider the example above regarding GBP/USD. If while you were in LA, you were trading Forex and predicted that the GBP/USD exchange rate would drop, you would make money! But if you predicted Great Britain’s currency would be stronger in comparison to the US Dollar, you would lose money.

Now the AMOUNT of money you make or lose depends on the lot size (size of your trade/number of currency units) you choose which we’ll discuss in a later section.