Trading forex is just the same as trading any other instrument. The differences are that forex is not traded on a central exchange, so what 1 broker quotes may not be the same as another broker. Wild, isn't it?
And trading isn't exactly cost free, it is commission free, but you pay them back in spread. Each currency pair has a spread. For instance, Euro/USD pair might have a spread of 3 pips and each pip is worth $10 on a standard lot. So in essence you are paying $30 to the broker as a fee since you are always buying the ask and selling the bid. So if you trade 5 standard lots on the Pound/USD pair (that has a 5 pip spread), you are paying 5 standard lot x 5 pip spread x $10 per pip = $250 in fees.
It's not always as cheap as it looks. Forex is great because they give you crazy leverage, like 400:1, 200:1, 100:1, depending on your account size. You can blow out an account in seconds if you don't know what you are doing. And Forexi is going 24 hours per day for 5-6 days. The brokers usually close on Friday night, Saturday and part of Sunday.
And some forex brokers are known to trade against the traders because it is so unregulated on multiple exchanges, and I use exchanges lightly. It is basically matching banks or liquidity providers with your orders, and each broker have different sources of these liquidity providers. The more liquidity, the better. But some are just small operations, and many call these bucketshops.
