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So you want to get involved in the foreign exchange market, or forex. You’re itching to trade one currency for another and make some profit. But you can’t just barge into Citigroup of Merrill Lynch and start throwing euros and yen around. To participate, you need a forex broker.

The preeminent forex broker for day traders (i.e., average Joes) is Advanced Currency Markets, or ACM. To many people, the Swiss company, founded in 2002, is synonymous with “forex broker,” trading about $70 billion a month.

There are dozens of other brokers, though, who service day traders. It’s done almost exclusively online, and in fact ordinary citizens rarely got involved with forex trading at all until the computer boom of the 1980s, and then exponentially more with the advent of the Internet in the 1990s. Since then, forex brokers have proliferated.

As you might expect, levels of reliability and competence vary from one broker to another. The Internet is rife with unsavory types seeking to take advantage of suckers, so you would do well to investigate thoroughly any broker you’re planning to use. Does their Web site look professional and reassuring, or is it riddled with dead links and spelling errors? Google the broker to see if they’ve been mentioned in news articles. Ask about their track record. And above all, avoid anyone who promises things that sound too good to be true, or who downplay the financial risk involved in forex trading.

Look for a broker that seems to genuinely want your business. Does the firm have customer service representatives available? Is there a phone number you can call to speak to a live person? The Web site should explain things clearly. If the site is full of language that seems designed to go over your head, look for a different broker.

If you set up an account with an online forex broker, it will work like this. First, you must apply for an account, which most brokers allow you to do online. This is to verify your identity and the validity of your bank accounts and financial records. Some brokers also require you to download their forex trading software, while others let you use whatever software you prefer. You will also have to transfer a minimum deposit to your account with your new broker. The minimum can be anywhere from $100 to $2,500.

Ideally, the broker you choose should offer service and support when you need it but should mostly simply stay out of the way and let you conduct your business. If you can find a forex broker who is professional and helpful, your experience in the forex market should be full of smooth sailing.

The foreign exchange, or forex, market is relatively young, having begun in the early 1970s after the United States dropped the gold standard and national currencies started to fluctuate widely. For about 30 years prior to that, most nations had agreed to keep their currency values stable in relation to the U.S. dollar, making a forex market unnecessary. With that no longer the case, banks quickly realized that a profit could be made in “buying” currency when it was devalued and “selling” it after it strengthened, just like any other commodity.

Today, the forex market handles about $1.9 trillion in transactions every day, and it runs 24 hours a day, five days a week. (With nations around the world involved, it’s always daytime somewhere.) The most traded currencies are the U.S. dollar, the euro, Japanese yen, British pound, Swiss franc and Australian dollar.

The forex market is overwhelmingly dominated by international banks, government banks, investment banks, corporations, and hedge funds. In fact, individual traders account for only about 2 percent of the market. Nonetheless, a lot of people do try their hand at it, with varying degrees of success.

In the forex market, transactions are always handled in pairs: You buy one currency and sell another one. The idea is to make a trade when you believe the currency you’re buying is going to go up in value compared to the one you’re selling. Then, if it turns out your prediction was correct, you do another trade in the reverse direction — selling the currency you originally bought and buying the one you sold — in order to reap the profits.

For example, let’s say the market reports this: GBP/EUR 1.2200. That means the cost of buying one British pound is 1.22 euros. If you believed that course was going to change, and the euro was going to become more valuable than the pound, you might sell 100,000 pounds, buy 100,000 euros, and wait. Then let’s say a few weeks later, the exchange rate fluctuates to this: EUR/GBP 1.3100. Sure enough, the euro is now worth 1.31 pounds, a profit of 0.11 per unit.

The forex market is vast and daunting and mostly inhabited by giant organizations. But it can be navigated by individuals who have studied the finer points and who want to take a risk on something potential profitable. And since the whole world uses money, the trading of that money is always going to be a major force in the financial world.

Before airplane pilots actually fly on their own, they usually practice in simulators that re-create what flying will be like without any actual risk. Since currency trading is as dangerous financially as flying is physically, it makes sense that there would be a forex demo available, too.

A forex demo is a smart way for a new investor to start. Reading books and taking online courses can teach you the basics, but the best way to learn anything is to get some hands-on experience. However, with forex, hands-on experience could mean losing your shirt. So a demo gives you real-world training with no actual money being involved.

Usually, the demonstration comes courtesy of a brokerage or other financial Web site that has an interest in currying your favor. The plan is that once you’ve tested your skills in the demo, you’ll get into the real thing and take advantage of the paid services the demo provider has to offer — forex signals, managed accounts, automated trading, etc. The demo is like a free sample, offered in the hopes that you’ll enjoy it so much that you buy something, too.

For that reason, be should be highly suspicious of any Web site that wants to charge for a demo. Considering there are literally dozens of sites that offer free demonstrations, there is absolutely no reason that you should pay for it.

When you sign up for a forex demo, you’re given a username and password and shown how to use the demo system. Sometimes it involves downloading a piece of software unique to the company; other times it’s simply done over the Internet. (Some demos require Macromedia Flash, which most browsers have installed, but which you’ll need the latest version of.) You determine how much imaginary money you want to start with, and off you go!

Once you’re signed in to the forex demo, you do all the things you would do if it were a real-world situation: reading the charts, following the trends, visiting online forums to get other traders’ opinions, and making trades. The trades are recorded in the forex demo only and don’t go anywhere into the actual market since there’s no real money involved. When the market changes, the program determines how much you’d have gained or lost based on the decisions you made. You’re able to say, “Whew! Good thing this was only for practice!” or “Too bad this wasn’t real!” And once you’ve gained some expertise using the forex demo, you can move on to the real thing and start making some money for real.

This is a guest post by full-time blogger and internet marketer, Justin Wright.

In my quest to become a full-time blogger, I have had many ups and downs along the way. I have tried things that worked and things that have failed miserably. Along the way, I have learned some valuable lessons.

Here are the 5 most valuable lessons I have learned from blogging:

1. The Journey Is Everything

Having a successful blog is something I always wanted to have, but early on I lacked the patience to wait around for it to happen. I had the common mindset of wanting it all now. I wanted to go to sleep one night and wake up with a popular blog the next morning. I wanted money to be rolling in while I slept. I wanted to have a following of a few thousand people and traffic stats beyond my wildest dreams.

Of course that would have been great, but what I did not realize at that time was that I would miss the most important part of all, the journey itself. Just like in life, the beginning and end are nowhere near as important as what we experience and accomplish in between.

The experience of starting a blog and watching yourself progress is something money cannot buy. It is amazing to see yourself become more knowledgeable and proficient as time moves on. You start to learn more and more and progress as a both a writer and a marketer. Just looking back at what my blog looked like 10 months ago compared to now gives me a great sense of accomplishment. My posts have been taken to a whole new level. They are longer, formatted better, and best of all, more useful and entertaining.

So never forget, that the journey of becoming a blogger is more important than the end product.

2. Hard Work Does Pay Off

When it comes to blogging, time is something you need a lot of. Starting a new blog takes a lot of time, commitment, and persistence. What makes it even more difficult is the fact that you are spending all your time and effort working on something that might not take off for 6 months to a year down the road.

Before starting my current blog, I had previously started more than 10 different blogs that never took off. Why? Because I abandoned them way before they ever made any progress. However, now that I have committed myself to a blog and worked hard on a day to day basis, I have seen some great results.

These results have reassured me that that hard work really does pay off, you just have to stick with it long enough to see results.

3. Relationships Are Everything

When I started on my blogging journey, the last thing on my mind was making friends and creating relationships with other bloggers. It’s not that I didn’t want to make friends, it just wasn’t something I had thought of when starting out. I failed to realize early on that besides making money and sharing your voice through blogging, you can also network with people from around the world.

Almost a year later, my mindset has shifted to the point where making friends and networking is one of the most important aspects of my blog. Instead of spending every second working on my own blog, I make sure to go out and leave feedback on other blogs. Not only does it help fellow bloggers out by increasing their comments, it keeps them motivated to keep writing. It helps you meet new people and create a network of friends that all share a similar hobby.

These friends and contacts can help you when you need blog advice, marketing, or a place to stay while traveling (it’s been done).

4. Doing What You Love Isn’t Work

Over the last 10 months, I have spent way more time on my blog than I would have expected. It has basically become a full-time job since I spend my time working on the design, writing content, and promoting it. However, this type of work feels different to me than any past job I have ever had. Why? Because doing what you love isn’t work. It’s a passion. It’s a hobby you enjoy doing regardless of the time or effort it takes. No wonder so many people tell you to do something you love growing up. The reason so many people are disappointed with their jobs is because it isn’t their ideal career.

This important lesson has taught me that regardless of how much money I can make blogging, it is what I am passionate about and enjoy doing. As long as I can make the bare minimum to survive, I will be happy with this choice.

5. Provide First, Reap The Rewards Later

I’ll admit that when I first started blogging two years ago, my main focus was making money as fast as possible. That’s it. I was looking for a easy formula to make money without having a job. The problem with that logic was the fact that I was trying to reap the rewards before providing a service. The lesson I learned from that mistake is that blogging is like any other business. You need to provide value before you can expect to make any money.

When it comes to adding value to your blog, providing valuable content to your readers on a consistent basis is key. Provide useful information that will make them want to come back time and time again. Offer free advice and reports instead of trying to sell them things early on. Create a relationship with your readers and respond to them when they send you emails or leave comments.

By focusing on providing value first, you will no doubt be rewarded for your time and efforts. It takes time, but pays off in the end.

Have you learned any valuable lessons from blogging? What are they?

Justin Wright is a full-time blogger and internet marketer that has a blog about life, travel, and blogging. He also enjoys photography and runs a photoblog.

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