Australia circulates its own sovereign currency: The Australian dollar. If you're planning to take part in any local transactions, you need to understand how and where to get Australian money. As with any foreign currency, Australian dollars are bought and sold like other products, and their value can change over time.

Your transactions will be faster and easier if you also have some passing familiarity with the currency you're about to start trading. Australian dollar basics that you should know before you start trading in this foreign currency include:

1. How to recognize Australian banknotes (their word for "bill") and coins;

2. What Australian dollars are worth against other world currencies;

3. How to purchase or trade for Australian dollars.

Action Steps
The best contacts and resources to help you get it done

Identify legal banknotes by gathering basic Australian dollar information

Australian currency looks and feels a bit different from US currency, mainly because of its sizing and coloring. You'll also notice that Australian transactions are always conducted in five cent increments, because that is the smallest denomination of coin in circulation.

I recommend: Get used to some of the differences between how US and Australian money is configured with a helpful overview of Aussie currency from About.com. MelbourneAustralia.com.au describes each denomination of Australian currency--both coins and banknotes--in great detail.

Become familiar with Australian dollar exchange rates

You may get more Australian dollars for your US dollars on one day and fewer on another because the value of Australian dollars against other world currencies fluctuates as the currencies are traded on world markets. If you're looking to trade the Australian dollar, chart displays of how the exchange rate varies over time will help you decide whether it's favorable to trade now or wait a little while.

I recommend: XE's Universal Currency Converter, which lets you calculate the value of other world currencies against the Australian dollar. Check out the easy-to understand graph at x-rates.com, which demonstrates how the Aussie dollar to US dollar exchange rate varies over time.

Learn about Australian dollar swap trading

While simply using your debit or credit card at an Australian ATM may be the simplest way to get a good Australian dollar exchange rate, you're not always guaranteed a working ATM or that your bank won't deny the transaction. You can swap trade, or exchange the Australian dollar for other currencies, at a number of other institutions--the key is knowing where to go.

I recommend: You can buy the Aussie dollar at current Australian dollar swap rates from many large banks, at money changers in international airports, or you can order foreign currency--including the Aussie dollar--online from American Express. If you happen to be an AAA member, you can also purchase foreign currency from them online or over the phone.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  As with many currencies, most money changers will buy back your left-over Australian currency, but they will only deal in banknotes, not coins; so make sure to use up as many of your leftover Australian coins as possible before departing Australia, or save them for your next trip.

Australia is sometimes called "The Lucky Country." With a stable political democracy and flourishing economy, the appeal of Australian dollar exchange rates remains high and prompts currency traders to push their luck in their market.

Currency exchange continues to be the world's most sought-after financial market and is available 24 hours a day. Australian dollar swap trading accounts for almost 5% of currency exchange dealings, the sixth highest.

Perhaps with the right amount of luck, some knowledge and experience, you can utilize the Australian dollar to make money. But before you jump into Australian currency trading, consider this Australian dollar information:

1. Compared to other countries, the Australian government has little control or involvement in foreign exchange markets.

2. Investors find the Aussie dollar to be lucrative because of its low volatility.

3. Note that currencies are traded as pairs and the Australian dollar is referred to as AUD or sometimes AU$.

Action Steps
The best contacts and resources to help you get it done

Learn Australian dollar information to be better informed before trading

Use online shortcuts to learn what you need to know about the Australian dollar. The more informed you are, the better decisions you can make regarding trading. Australian dollar rates fluctuate with a number of factors including interest rates and the import-export markets, among others.

I recommend: Study the currency profile of the Australian dollar at Ruesch and research pairing options at CitiFinancial.

Analyze Australian dollar exchange rates

Smart investors form trading plans by cultivating data from a variety of sources and then analyzing that data to make their decisions. To form that analysis, check out historical data of Australian dollar swap rates. Because the market is constantly changing, profitability comes from timing for a currency exchange.

I recommend: There are a number of resources to help you form your analysis. An Australian dollar chart such as the weekly one from TFC Commodity Charts is a good place to start. The Economist provides an Australian dollar chart that contains historical data and shows how the Australian dollar compares to other currencies.

Practice makes perfect in Aussie dollar trading

Currency trading may appeal to beginners because it tends to be easier to catch on to than other forms of investing. But just as with trying anything for the first time, it may help to practice before making a go of it with real money.

I recommend: See how you would fare at currency trading with a Forex.com 30-day practice account with $50,000 in virtual trading money to get you started. Or download a demo account from CitiFinancial.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Watch the calendar. Be sure to keep track of important financial dates that may impact the currency exchange market such as the release of retail sales numbers or governmental meetings about interest rates.

Interested in trading the Australian dollar? Some beginners may find currency trading overwhelming. However, an investor's confidence can soar with the right knowledge. From online classes and articles to a free practice account, there are plenty of resources on currency trading.

Although trading the Aussie dollar and other currency is considered high risk, that shouldn't deter you from learning more. Many who trade on the stock market find the principles are similar with currency trading. Want some more good news? Unlike trading stocks with thousands of stock information to sift through, there are only six major currencies to research.

Before choosing the appropriate materials, it may be helpful to determine your learning style. Keep these other educational strategies in mind:

1. Find an Australian dollar chart that keeps current. It may be helpful to subscribe to an automated feed that loads on your computer daily.

2. Gain access to Australian dollar exchange rates that can also be shown in graphical form. That way you can easily compare the Australian dollar to other currencies.

3. Australian dollar trading education and training books, videos or CDs are other options and readily available for beginners to use.

Action Steps
The best contacts and resources to help you get it done

Lean about current Australian dollar swap rates through online classes

Whether you start with a free class or spend thousands on a live seminar, find the currency trading classes that work best for you and your budget. There are several options online, with some especially geared for the beginning trader.

I recommend: Sign up for a free course provided by Online Trading Academy. By registering, you will also receive a free trading newsletter. Or sign up for a two-day seminar with topics like chart patterns, risk control and rate differentials from FX Trading Education.

Read more about Australian dollar swap trading

Learn technical or fundamental analysis, key terms, risk management and other trading strategies through web-based articles. There are thousands on the topic, ranging from the very basic to the intricacies of the market. Explore different topics and get answers to individual questions.

I recommend: Log on to ActionForex.com for numerous articles from which you can glean tips and tricks from professional traders and service representatives. Or get an independent perspective at Forextradings.com with articles written by educators.

Put information about the Australian dollar into practice

Practice makes perfect especially if you learn by doing. Several services offer a free trial account where users can practice trading before using their own money.

I recommend: Forex Capital Markets sets you up with $50,000 in practice money and access to live trading for a short period of time. FOREX.com offers a similar educational account.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  The best path toward profitability? Experts say acting on solid market information about Australian currency and keeping emotions in check is key.