Saad (41 years old) spends seven hours a day trading on Forex, but he is still wary of the fraud that usually accompanies these transactions in Iraq, as he confirms that those close to him strongly warn him against entering this world, so he is forced to tell many people that he works in computer and phone maintenance.
Saad, who only mentioned his first name, stated during an interview with “Al Aalem Al Jadeed” that “Forex is trading in foreign currencies in a global market through brokerage companies according to special platforms and a specific server within each platform,” pointing out that “among the transactions is dealing with gold.”
He adds, “Trading in gold takes place with other foreign currencies within the platform as a type of commodity, and other commodities are also traded within the platform other than gold, such as silver, oil, gas, even wheat, soybeans, and many others.”
He points out that “one of the most important reasons for the rise in gold prices is that gold represents a safe haven for investors, capital owners, companies and investment banks, as it represents a tool for hedging against inflation, which leads to paper currencies losing their real value. Therefore, investors resort to hedging with gold, buying it and storing it to preserve the value of their property.”
Forex trading, or what is known as foreign exchange trading, is the conversion of one currency into another, and is one of the most active traded markets in the world, with an average daily trading volume of approximately $5 trillion.
For his part, economic expert Manar Al-Obaidi pointed out, during an interview with Al Aalem Al Jadeed, that “Forex is a system that exists all over the world that works to attract capital and invest it in gold and many other commodities and currencies.”
Regarding this activity in Iraq, Al-Obaidi adds, “Iraq did not license Forex transactions and the companies dealing in it were not licensed, which paved the way for many cases of fraud against people paid by the fictitious profits of companies that do not exist in Iraq.”
Al-Obaidi also states, “Trading transactions via Forex in Iraq may be a good indicator, but if it is done under the supervision, control, and regulation of the regulatory bodies, most notably the Central Bank of Iraq and the Securities Commission, otherwise we will witness many cases of fraud and fraud.”
Access to the Forex or foreign exchange market is done through a platform known as Meta Trader, which is a platform that provides access to this market through brokers registered with it. Any person can register with an accredited brokerage company registered on the Meta Trader platform and has a special server within the platform.
The Forex market is managed through a global network of banks distributed among four main trading centers in different time zones: London, New York, Sydney, and Tokyo, due to the lack of a central location, it is possible to trade Forex 24 hours a day.
Hassan Fahim, another Forex trader, confirmed during an interview with “Al Aalem Al Jadeed” that “the world is witnessing a state of high inflation that began since the Corona virus pandemic and the subsequent economic measures taken by major countries to recover their economies, but what exacerbated inflation was the outbreak of the Russian-Ukrainian war and the Gaza later, and inflation rises with the possibility of new major international crises erupting, all of which lead to an increase in the value of gold because investors, as a result of their fear of these events, resort to buying gold and storing it in large quantities and getting rid of the cash that they were holding.”
He adds: “In 2022, inflation rose in the United States of America, which is the largest economy in the world, to the level of 9.4%, which is a significant level that prompted the Federal Reserve Bank to raise the interest rate, which raised the value of the dollar and led to a decline in gold in 2023, but gold quickly returned to High levels due to the Fed’s retreat from raising interest rates, which led to a decline in the value of the dollar against gold, so investors resort to getting rid of the dollar they bought in 2023 and replacing it with gold to hedge against the decline in its value, which leads to a decline in the value of their wealth.”
Hassan also mentions, “It is expected that if the Federal Reserve reduces interest rates, gold will continue the historic rise it is achieving these days as wars and international crises continue and do not stop.”
The basis of Forex trading is the act of speculating on the movement of exchange rates by buying one currency while selling another at the same time. The value of the currencies rises and falls against each other due to economic, geopolitical and technical factors.
