More and more knowledgeable investors and entrepreneurs are diversifying their traditional investments like stocks, bonds and foreign exchange products due to the following reasons :
1. FOREX is the largest financial market in the world.
With a daily trading volume of over $ 1.5 trillion, the spot FOREX market can absorb, trade sizes that dwarf the capacity of any other market. In fact, compared to the daily market of $ 50 billion for the shares or the market for 30 billion U.S. dollars in future, it becomes quickly apparent this gives you, and millions of other Forex traders, almost infinite trading liquidity and flexibility.
2. FOREX market is a true 24 hours.
The FOREX market never sleeps. Negotiating positions can be entered and exited at any moment around the world, all day, 5.5 days a week. Do not wait for an opening bell as in the case of commercial 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 to trade: morning, noon or night.
3. Never a bear market FOREX.
You can access a seamless exchange of currencies. Currencies trade in “pairs” (eg the U.S. dollar compared with ¥ (yen) or U.S. dollar against CHF (Swiss franc), one side of every currency pair (eg , USD / CHF) is constantly moving in relation to the other.
Therefore, when you buy a particular currency, you are actually simultaneously selling the other currency in that particular pair. As the market, one of the currencies will increase in value against the other. Of course it is to you to choose the correct currency long-term (bought) or short (sold).
4. Exploiting High – up to 400:1 Leverage.
It allows you to trade foreign currencies on a highly leveraged basis – up to 400 times your investment.
Standard 100,000 – U.S. $ currency lots can be traded with as little margin of 0.25%, or $ 250. Mini FX accounts are permitted trade with a margin of just 0.25%, ie, only $ 25 lets you control a currency position 10,000.
Futures traders, who are accustomed to margin usually equal to 5.7% -8% of the contract value, immediately recognize that the FOREX market provides much greater momentum, and security dealers, who must put at least 50 % margin, there is no comparison. If you are looking for an efficient use of trade, trade in Forex Market.
5. The price movements can be very predictable.
Prices of currencies in the forex market generally repeat themselves in relatively predictable cycles, creating trends. The strong trends that foreign currencies are developing a significant advantage for traders using the methods of the “technical” and strategies.
Unlike stocks, currencies tend to develop strong trends. Over 80% of volume is speculative in nature and as a result, the market often exceeded and then corrects itself. As a technically trained trader, you can easily identify new trends and breakouts, to enter and exit positions.
6. You pay no commissions or fees to the Forex market.
When the Forex market, can be made completely free of fees and expenses, regardless of account size.
Most forex brokers require a very low minimum amount to open a brokerage account, only U.S. $ 200 and they do not charge commissions or fees to trade or to maintain an account, regardless of your account balance or trading volume.
7. You do not have to pay trading fees or exchange fees.
There are none of the usual fees, operators and equity futures are used to pay:
- NO exchange or clearing fees.
- NO NFA or SEC fees.
Because currencies trade counter (OTC), through a global electronic network, in FOREX, what you see in the screen trade, is what is, allowing you to make quick decisions in their operations without having to worry or account for fees that can affect your profit / loss or slippage.
In the capital and commodity markets, you must pay a commission and exchange fees. The Over-the-counter foreign exchange market structure and exchange rates eliminates the compensation, which in turn reduces transaction costs.
8. As Currency brokers make money if they do not charge commissions ?
Like all financial products are traded, above the counter currency trading involves a purchase / sale, which represents the prices at which your counterpart is willing to trade. Your agent will receive a portion of the purchase / sale.
Because the currency market offers round the clock liquidity, you receive tight, competitive spreads both intra-day and night. Securities Dealers may be more vulnerable to liquidity risk and typically receive higher profit margins, especially in after-hours trading.
9. Market transparency.
Market transparency is highly desired in any trading environment. The greater the market transparency, the more efficient the market becomes.
Unlike other markets where transparency is compromised (as in the many recent scandals), the FOREX market are very transparent (ie countries to analyze and access real-time research / news, is easier than the analysis of companies).
Because of this transparency, as an FX trader, you will be able to implement risk management strategies according to their fundamental and technical indicators.
10. Order executed immediately.
The FX market offers the highest level of market transparency of all financial markets. Because of this, order execution and fill out the confirmation usually occur in just 1-2 seconds.
In Forex, the execution is fully electronic and because he was trading through an Internet-based platform, instantaneous execution is routine.
There are no exchanges, no traditional open wells protests, no floor brokers, and consequently, no delays.
continued . . .