Forex Trading Tips: E-Currency 101

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The advent of the internet and online banking has made it possible for people to purchase and to trade goods without requiring the use of paper money. Today, online traders transact with e-currency. As the name would suggest, e-currency stands for electronic currency. And while it does not have a physical manifestation like paper money, the value of e-currency is real and is accepted by stores and traders that accept electronic transactions.

While e-currency is popular among online shoppers, you as a forex trader can benefit from it too. So unless you have considered using it, let us share with you a number of characteristics and advantages of this type of currency, starting with…

  1. Speed. This is probably one of the biggest advantages of e-currency. With paper money, you need to take a trip to the bank just to deposit or withdraw it. It’s much easier with e-currency. All you need to do is make a few clicks on your computer and you can start transferring money from one account to another and make withdrawals on the fly. All these happen in a matter of a few seconds, so everything’s quick and convenient.
  2. It is safe. Of course, safety is a relative term. However, e-currency cannot be faked unlike paper money, so you can be sure that you are transacting with the real thing with this type of currency. You may also opt to use electronic purses to keep your electronic funds safe on your computer and away from the hands of hackers.
  3. It enables you trade in forex—and more. E-currency is what you will use when you trade forex online. To get started, all you need to do is set up an account and then fund it via a bank deposit, your credit card, or other form of e-currency. From there, you will be able to start trading in the forex market. It doesn’t stop there. You could then use your funds for other transactions that accept e-currency. So you can use it to buy books at Amazon, apps at the Apple App Store, or gadgets on eBay.
  4. You can trade gold and silver. Called e-gold (XAU) and e-silver (XAG), you can use your e-currency to trade these precious metals without actually owning them. Rather, you purchase the contract of the price of these metals, which you could then trade in the market.

There you have it. If wish to trade forex online, buy and sell products, or just have an easy and convenient way to move your funds, using e-currency is the way to go. Be sure to check out our FX Guides section for more tips and trading ideas.

By FX Strategy Team, Published on 19th of March 2013
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