Benefits Of Forex Trading
The topics covered in this lesson are the following:
- Market Hours – Around the Clock Global Market
- Liquidity – Getting in and out of the Market
- Leverage – Control Larger Positions with Less Capital
- Transaction Costs – What type of Fees are in Forex
- Participants – Who are the Players in the Forex Market
Learning Goal: Understanding the Benefits of Forex vs Stocks
Reasons To Trade In The FOREX Market
If you ask Forex traders the number one reason they trade Forex, the majority of them would say, Profit Potential! There is a unique and potentially very profitable opportunity offered through Spot Forex markets regardless of the condition of the market. The advantages of Forex trading are:
- Around the Clock Market – A trader can trade anytime that they think market conditions are favorable; Forex offers a 24-hour market, 6-Days a week. This is particularly convenient for those who wish to trade Forex on a part-time basis. You can easily find markets to trade that will not conflict with your work schedule. There is basically no schedule that the Forex market can not accommodate.
- Liquidity in Forex – A market place of Free Trade. On a daily basis, the foreign exchange is more than a 4 trillion (and growing) dollar market! This is approximately 46 times larger than all the futures markets combined. Governments around the world struggle to control their own currency because of the massive number of people trading Forex worldwide. A trader can enter or exit the market almost totally at will; where no other market offers as much liquidity. Whether you are an individual trader with a small amount of money, or work for a major corporation or bank with millions of dollars, there are always opportunities in the Forex market to suit your needs.
- Leverage in Forex – There are very few execution barriers and no limits are placed on daily trading. The leverage available in Forex is much higher than equity markets. A leverage ratio of up to 50:1 in the US & up to 400:1 outside the US in comparison to 2:1 in the equity markets. Retail Forex traders love this because they can start with smaller amounts of money. Although the risk of using greater leverage can be higher in FOREX trading, the potential for profit is there as well! During this Free Video Training Series & presentation we will provide you with the education on how to use leverage intelligently & profitably.
- Low-cost Transactions – Compared to other markets the Forex market has some of the smallest transaction costs available, allowing traders to profit even more! Forex trading consists of buying or selling one currency against another, and there is always a profit opportunity for one currency pair or another.
- No Market Monopoly – Due to the sheer size and liquidity of the Forex market, no single trader or bank can control the market price for any length of time. More and more individual traders are now trading Forex as opposed to equities. Without any organized exchanges like the New York Stock Exchange, trading is facilitated by electronic communication and telephones.