Forex Trading means selling and buying different countries currency and earning profits when we sell or buy.
Example:
We can buy US Dollar if we think the price of the dollar is increasing and sell the currency when we have the excepted profits in our hand and this is one of the biggest finance market that works 24 hours and 5 days in a week.(This is not investment advice)
Who can invest in this forex trading?
Even normal investors also can trade in this segment but there are some conditions it determines whether your forex trading is legal or illegal in India.
It is legal when the we trade through a certain SEBI (Securities and Exchange Board of India) and RBI (Reserve bank of India) and we should not trade in the platform which are not recognized by this two.
What are the penalties and why the restrictions? Penalty for illegal forex trading is fine(transaction amount x 3 times) and even in rare cases you will also go to jail.