How Is Money Made in Forex?

I remember that once, a friend of mine ask me what I was doing and I told him I was trading Forex.

Then he said to  me ' Oh... forex? what currency you buy?'

I told him I trade various currency pairs.

before i could continue, he said "I recently also bough some US Dollars. I waited for the exchange rate to up.. then i change the US Dollars to Singapore Dollar. I made some money there"

I smiled at him at said ' Oh that's nice!'

But the way I trade Forex is different.

I told him I do it from home with my laptop.

Then his face changed signalling me a 'I don't know what you are talking about face'

So, that just show me how unfamiliar people are about online forex trading.

So, how is money made from Forex trading from home?

Well, in order to trade forex from home, we need to load our funds to a Forex Broker.

I am using FX Primus.

You can do a search on them, they are pretty good.

Low spread and great connection for the trading platform.

With our money in the broker, we can them execute BUY or SELL orders from the platform.


In Forex, we earn money by winning PIPs. (Pips explained here)

So, lets look at a simple example.

Say that we are trading the EURUSD pair and the current price is 1.3050

We enter a BUY order at 1.3050.

After a while, the price went up to 1.3060

As of now, the market price for EURUSD went up 10 Pips.

If i close my order now, I would have won 10 Pips.

Easy right?


A Pip in forex can hold a different value depending on the lot size of the trade.

As traders, we can trade
10 cents/pip, 
1 dollar/pip
10 dollar/pip
100 dollar/pip

You get the idea right?

Back to the example,

We made 10 pips from that trade.

If I had put down a lot size equivalent to 10 dollar per pip, I would have profited 100 dollars out of that trade.

If it was 100 dollar per pip, I would have profited 1000 dollars.

See the power of Forex?

You can learn in detail on how money is made from Forex here at this forum.

Hope this post help you see the potential  in Forex.



Yours sincerely,




 Check Out my other posts here- My Justinnation