# Exchange Rate

An exchange rate refers to the rate of one currency that will be traded against another. For example – you are trading $200 of your native currency with another foreign currency. If the demand for your native currency exceeds the foreign one, you will get a higher exchange rate. 
The exchange rate also exhibits the quoted currency’s required price to buy a unit of the base currency.
#Pip
A pip also referred to as percentage in point or price interest point, helps measure the fluctuations caused in the exchange rate for a currency pair. Most currency pairs have 4 decimal points, except for the Japanese Yen. It has only 2 decimal points. The price change is calculated through the last decimal point. 
Let’s suppose – A currency pair of INR/USD shifts from 1.5550 to 1.5551; that’s 1 pip movement. If it moves from 1.5550 to 1.5555, that is 5 pip movement
#Currency Pairs
A currency pair is the quoted value of two different currencies, where the base currency, also known as the first currency, is compared with the value of another currency, also known as the quote currency. It is like a one-to-one comparison between two different sets. 
The most common example of a currency pair is the EUR/USD pair, which represents the value of one Euro in terms of US dollars.
When trading in the foreign exchange market, traders can buy or sell a currency pair in order to profit from the change in the exchange rate. For example, if a trader believes the Euro will strengthen against the US dollar, they may buy the EUR/USD currency pair. If the Euro strengthens and the exchange rate increases, the trader can sell the pair at a higher rate than they bought it, making a profit.
#Lot Size

Forex trading is generally executed in lots. The lot size is commonly determined as the number of currency units you are likely to buy or sell. For instance – purchasing 1 standard lot, which is 100,000 units of a EUR/USD currency pair at the value of 1.3125, you basically buy 100,000 Euros and sell 131,250 US Dollars.
Selling 1 micro-lot, which is 1,000 units of the same currency pair at the exact value, you primarily sell 1,000 Euros and purchase 1,312 US Dollars. 
#Spread
Spread suggests a contrast between a forex broker’s selling and buying rate at the time of trading currency pairs. It can also be called an asked and bid value by the broker during forex trading. There are big and small spreads; some are fixed, while others can be variable. 
#Leverage
It indicates the loaning of money by forex brokers to traders to trade in bigger lots. Usually, leverage depends on how much a forex broker is flexible enough to lend you money. At the same time, it also relies on the type of account you create, what is the leverage of the account you created, and how much leverage you need. 
#Ask Price

The ask price or offer price is a value pitched by the seller to the buyer. The ask price is always displayed on the right side of the quote currency (base currency), where you can purchase the base currency/commodity at the shown price.

Bid Price

The bid price is the value you raise for selling a particular currency pair or commodity. Commonly, two prices are quoted for currency pairs, and you are supposed to bid at the first listed value to sell the currency pair. You must remember that the bidding value should be lower than the asking price. 
Since you are clear with the basics, we shall explain the currency trading strategies. 
#Call

The term ‘call’ permits a buyer to purchase a currency at a predetermined value (strike price) on or before the specified date. Buyers commonly invest in a currency when they foresee the rising value of the currency and how it can be profitable for them in the future. 
As a forex trader, if you want to secure a currency for a specified price and time, the ‘call’ technique is the perfect option for you.
How To Invest In Forex In India?

Below are the steps to do forex trading legally in India:

Step 1: Get A Reliable And Fast Internet Connectivity

The foremost step for forex trading is having a quick internet connection that ensures zero to minimum latency. Forex trading is a competitive market; staying ahead is necessary to grab a desirable trade. Hence, it is paramount to have a good internet connection. 
Once you get high-speed internet, the next step is getting a hosting service, and no other hosting type comes as close as VPS. VPS hosting services are a perfect example of great performance. It reduces latency and slippage and acts like a dedicated server. 
When high-speed broadband is combined with VPS hosting, you get a lightning-fast trading experience. Meaning your orders are delivered to the broker at a faster rate. 
In fact, many VPS hosting service providers offer a dedicated VPS to Forex. Forex VPS hosting is specifically designed for forex trades to ensure continuous trades with maximum safety and security against system failures. Besides securing your system and reducing latency, you can create constant backups of your entire trading, including the OS and trading software.

Step 2: Get A Licensed Forex Broker

Here are a few things you must take into account when finding a forex broker:

Brokers should be compliant with the rules and regulations of forex trading. They should have a forex trading license to ensure seamless forex operations. 

Must be acclaimed and trusted in the market.

Should have a low fee structure. Besides that, you must also look for additional charges like account fees, inactivity fees, price-per-trade fees, and currency conversion fees. Taking care of these extra costs ensures the trader does not gobble up your profit. 

Since forex is a 24*5 global market, choosing a broker that offers round-the-clock, reliable trading services is great. So you don’t miss out on any trading opportunities. 

Do seek traders offering high operating leveraging ratios at smaller margins. 

Successful trading brokers will have the tools and resources with a perfectly-maintained platform. Testing the platform is the best way to know whether or not it is accurate for your specific criteria. Go through every tab you see on the platform and check their data. Review the motions of placing a trade to understand how seamlessly trade places.