The use of high leverage to the ratio of 1:100, coupled with the strong variability in the current exchange rates made the Forex market is very lucrative, but also very risky.
In order to more clearly understand all of above we can show a simple example. Suppose you have a desire to buy 100,000 dollars per euro. In this case, if the 1% margin exists, leverage will be 1:100. You will be required to make only 1000 dollars pledge. And all profits or losses associated with the purchase of 100,000 dollars for euros, which arose as a result of changing the current exchange rate will be recorded in full on your account, and the bank does not charge for your transaction fees. In this case, the bank's profit is in another, it is to leverage your funds.
Another extremely important advantage of the Forex market is the opportunity to make profit in any direction of price change. This is due in particular to those that sell the euro or Japanese yen, you will not necessarily have in your account specifically the yen or euro.