There are many advantages of Forex Trading as its main revenue generator. Let's start with something that may be bothering you anymore.
"Do I need a diploma or some kind of certification to trade FOREX?" The answer is:
When it comes to more wins than losses on the fluctuation of exchange rates between major currencies (ie, currency trading), nobody will ask for a diploma, a formal license or verify the amount of hours you dedicated to the study of foreign exchange market and the banking industry. All you need is proper training.
But this is not the only advantage you get when the foreign exchange market, compared with other forms of investment and speculation, that is, stocks and commodities. You have a lot of advantages over these other options listed in the following paragraphs.
The main benefits of trading the spot currency market:
1): FOREX is the largest financial market in the world.
With a daily volume of more than $ 1.5 trillion, the spot currency market can absorb trading sizes that minimize the ability of any other market. In fact, compared to the market of $ 50 billion a day for the stock or market of $ 30 billion futures, becomes quickly apparent this gives you, and millions of other forex traders, liquidity trade almost infinite flexibility.
2): Forex is a true 24 hour market.
The FOREX market never sleeps. Negotiating positions can be entered and exited at any time - around the world, all day, six days a week. No waiting for an opening bell as in the case of trading stocks. This is a 24 - hour, continuous electronic (ONLINE) currency exchange that never closes. This is very convenient for you if you want to operate on a part-time because you can choose when they want to trade: morning, noon or night.
3): There is a bear market in the currency market.
You can access a seamless, mutually-inclusive (two-way) exchange of currencies. Meaning, because currencies trade in "pairs" (for example, U.S. dollar or the yen against the U.S. dollar against the Swiss franc), one of the sides of each currency pair (for example, USD / JPY - JPY = YEN) is constantly moving in relation to the other. Therefore, when you buy a particular currency, while actually selling the currency in which the match in particular. As the market of the currencies will increase in value compared to the other. Of course, it depends on you to choose the correct currency to be long or short. Since currency trading always involves buying one currency and selling another, there is no structural bias in the market. This means they have the same profit potential in both a rising or falling market.
4): High Leverage - up to 200:1 leverage.
You are permitted to trade foreign currencies on a highly leveraged basis - up to 200 times your investment with some brokers. This is mainly attributed to higher levels of liquidity in the currency markets. Standard 100,000 - unit currency lots can be traded with a range as little as 1%, or $ 1,000. Mini FX accounts are permitted to trade with just 0.5% margin - in other words, only $ 50 lets you control the currency position of 10,000 units. Futures traders, who are accustomed to margin requirements generally equal to 5% and 8% of contract value, will immediately recognize that the foreign exchange market provides leverage much greater, and for stock traders, who must to at least 50% margin, thereâ? ? s no comparison. If you are looking for a capital-efficient business, that's all!
5): price movements are highly predictable.
Although the prices of the currency in the foreign exchange market can be volatile, often repeated in relatively predictable cycles, creating trends. The strong trends that foreign currencies develop are a significant advantage for the proper use traderswho "technical" methods.Unlike stocks, currencies rarely spend much time in tight trading ranges and have the tendency to develop a strong trend. Over 80% of volume is speculative in nature and as a result, the market often exceeds and then corrected. As a training technique, you can easily identify new trends and breakouts, which provide multiple opportunities to enter and exit positions.
6:) commission-free trade and low transaction cost
When currency trading through one of our recommended agents (this information is in our private resources section), it will completely free of commission! These brokers do not charge commissions to trade or to maintain an account, and that goes for all clients of forex trading through them, regardless of their account balance or trading volume. Even Mini FX traders can buy and sell currencies online, commission free.
What about trading fees? There is none of the usual fees to which futures and equity are accustomed - no exchange or clearing fees, no dues or S_E_C N_F_A. Because currencies trade over the counter (OTC), through a global electronic network - in FOREX, what you see is what you get, allowing you to make quick decisions in their operations without having to worry or account for fees that may affect your profit / loss or slippage.In stock markets, you must pay both a commission and exchange fees. The structure on the counter currency market, eliminating the cost of change and compensation, which in turn reduces transaction costs.
Therefore, if forex broker do not charge commissions, how to make money? Like all financial products traded on the counter currency trading involves a bid / offer spread, which represents the price at which your counterpart is willing to trade. Because the currency market offers round the clock liquidity, tight spreads and competitive are both intra-day and night. Brokers may be more vulnerable to liquidity risk and typically receive higher trading spreads, especially in electronic transactions.
7): Instant Order Execution and market transparency.
Market transparency is highly desired in any commercial environment. The greater market transparency, the more efficient the market becomes. Unlike other markets where transparency is compromised (as in the Enron scandal), the currency markets are highly transparent (ie, analyzing countries, and access real-time research / news, is easier for companies).
Because of this transparency, as an FX trader, you will be able to exercise risk management strategies based on fundamental and technical indicators we teach RapidForex. comThe FX offers the highest level of market transparency in all financial markets. Because of this confirmation of order execution and fill usually occur in just 2.1 seconds. Markets that do not offer executable
prices and force traders to absorb slippage obviously compromise the trader's profit potential considerably.
In the world of currency, the execution order is entirely electronic and because you are trading through an Internet-based platform, instantaneous execution is routine. No exchange, no traditional open outcry pits, no floor brokers and, consequently, no delays.
"Do I need a diploma or some kind of certification to trade FOREX?" The answer is:
When it comes to more wins than losses on the fluctuation of exchange rates between major currencies (ie, currency trading), nobody will ask for a diploma, a formal license or verify the amount of hours you dedicated to the study of foreign exchange market and the banking industry. All you need is proper training.
But this is not the only advantage you get when the foreign exchange market, compared with other forms of investment and speculation, that is, stocks and commodities. You have a lot of advantages over these other options listed in the following paragraphs.
The main benefits of trading the spot currency market:
1): FOREX is the largest financial market in the world.
With a daily volume of more than $ 1.5 trillion, the spot currency market can absorb trading sizes that minimize the ability of any other market. In fact, compared to the market of $ 50 billion a day for the stock or market of $ 30 billion futures, becomes quickly apparent this gives you, and millions of other forex traders, liquidity trade almost infinite flexibility.
2): Forex is a true 24 hour market.
The FOREX market never sleeps. Negotiating positions can be entered and exited at any time - around the world, all day, six days a week. No waiting for an opening bell as in the case of trading stocks. This is a 24 - hour, continuous electronic (ONLINE) currency exchange that never closes. This is very convenient for you if you want to operate on a part-time because you can choose when they want to trade: morning, noon or night.
3): There is a bear market in the currency market.
You can access a seamless, mutually-inclusive (two-way) exchange of currencies. Meaning, because currencies trade in "pairs" (for example, U.S. dollar or the yen against the U.S. dollar against the Swiss franc), one of the sides of each currency pair (for example, USD / JPY - JPY = YEN) is constantly moving in relation to the other. Therefore, when you buy a particular currency, while actually selling the currency in which the match in particular. As the market of the currencies will increase in value compared to the other. Of course, it depends on you to choose the correct currency to be long or short. Since currency trading always involves buying one currency and selling another, there is no structural bias in the market. This means they have the same profit potential in both a rising or falling market.
4): High Leverage - up to 200:1 leverage.
You are permitted to trade foreign currencies on a highly leveraged basis - up to 200 times your investment with some brokers. This is mainly attributed to higher levels of liquidity in the currency markets. Standard 100,000 - unit currency lots can be traded with a range as little as 1%, or $ 1,000. Mini FX accounts are permitted to trade with just 0.5% margin - in other words, only $ 50 lets you control the currency position of 10,000 units. Futures traders, who are accustomed to margin requirements generally equal to 5% and 8% of contract value, will immediately recognize that the foreign exchange market provides leverage much greater, and for stock traders, who must to at least 50% margin, thereâ? ? s no comparison. If you are looking for a capital-efficient business, that's all!
5): price movements are highly predictable.
Although the prices of the currency in the foreign exchange market can be volatile, often repeated in relatively predictable cycles, creating trends. The strong trends that foreign currencies develop are a significant advantage for the proper use traderswho "technical" methods.Unlike stocks, currencies rarely spend much time in tight trading ranges and have the tendency to develop a strong trend. Over 80% of volume is speculative in nature and as a result, the market often exceeds and then corrected. As a training technique, you can easily identify new trends and breakouts, which provide multiple opportunities to enter and exit positions.
6:) commission-free trade and low transaction cost
When currency trading through one of our recommended agents (this information is in our private resources section), it will completely free of commission! These brokers do not charge commissions to trade or to maintain an account, and that goes for all clients of forex trading through them, regardless of their account balance or trading volume. Even Mini FX traders can buy and sell currencies online, commission free.
What about trading fees? There is none of the usual fees to which futures and equity are accustomed - no exchange or clearing fees, no dues or S_E_C N_F_A. Because currencies trade over the counter (OTC), through a global electronic network - in FOREX, what you see is what you get, allowing you to make quick decisions in their operations without having to worry or account for fees that may affect your profit / loss or slippage.In stock markets, you must pay both a commission and exchange fees. The structure on the counter currency market, eliminating the cost of change and compensation, which in turn reduces transaction costs.
Therefore, if forex broker do not charge commissions, how to make money? Like all financial products traded on the counter currency trading involves a bid / offer spread, which represents the price at which your counterpart is willing to trade. Because the currency market offers round the clock liquidity, tight spreads and competitive are both intra-day and night. Brokers may be more vulnerable to liquidity risk and typically receive higher trading spreads, especially in electronic transactions.
7): Instant Order Execution and market transparency.
Market transparency is highly desired in any commercial environment. The greater market transparency, the more efficient the market becomes. Unlike other markets where transparency is compromised (as in the Enron scandal), the currency markets are highly transparent (ie, analyzing countries, and access real-time research / news, is easier for companies).
Because of this transparency, as an FX trader, you will be able to exercise risk management strategies based on fundamental and technical indicators we teach RapidForex. comThe FX offers the highest level of market transparency in all financial markets. Because of this confirmation of order execution and fill usually occur in just 2.1 seconds. Markets that do not offer executable
prices and force traders to absorb slippage obviously compromise the trader's profit potential considerably.
In the world of currency, the execution order is entirely electronic and because you are trading through an Internet-based platform, instantaneous execution is routine. No exchange, no traditional open outcry pits, no floor brokers and, consequently, no delays.
Post a Comment