How To Start Trading The Forex Market? (part 3)
10 REASONS TO START TRADING FOREX!
More and additional well informed investor and entrepreneurs are diversifying their traditional investments like stocks, bonds & commodities with foreign currency because of the subsequent reasons:
1) FOREX is the most important financial market within the world.
With a daily trading volume of over $1.five trillion, the spot FOREX market will absorb trading sizes that dwarf the capacity of any alternative market. In fact, when compared with the $fifty billion daily market for equities or the $30 billion futures market, it becomes quickly apparent this offers you, and immeasurable other FOREX traders, almost infinite trading liquidity and flexibility.
2) FOREX may be a True 24-hour market.
The FOREX Market never sleeps. Trading positions will be entered and exited at any moment around the globe, round the clock, 5.five days a week. There’s no waiting for an opening bell as within the case of trading stocks. It’s a twenty four- hour, continuous electronic (ONLINE) currency exchange that never closes. This is often terribly desirable for you if you would like to trade on a half-time basis, as a result of you’ll opt for when you want to trade: morning, noon or night.
3) There is never a Bear Market in FOREX.
You’ll have access to a seamless exchange of currencies. Currencies trade in “pairs” (as an example, US dollar vs. JPY (YEN) or US dollar vs. CHF (Swiss franc), one side of every currency try (as an example, USD/CHF) is consistently moving in relation to the other. So, when you purchase a explicit currency, you’re truly simultaneously selling the opposite currency in that exact pair. As the market moves, one of the currencies can increase in value versus the other. Of course, it is up to you to settle on the right currency to be long ( to procure) or short( you sold).
4) High Leverage – up to four hundred:one Leverage.
You’re permitted to trade foreign currencies on a highly leveraged basis – up to four hundred times your investment with Fenix Capital Management, LLC and with another brokers.
Commonplace a hundred,000- US$ currency heaps can be traded with as little as 0.25% margin, or $250.
Mini FX accounts are permitted to trade with just 0.twenty five% margin, which means, just $25 allows you to regulate a ten,000-unit currency position.
Futures traders, who are aware of margin requirements typically equal to 5-seven%-8% of the contract value, can immediately acknowledge {that the} FOREX market provides abundant larger leverage, and for stock traders, who must post a minimum of fifty% margin, there’s no comparison. If you’re trying for an efficient use of trading , trade the Forex Market.
5) Price Movements would possibly be Highly Predictable.
Currency prices within the FX market typically repeat themselves in comparatively predictable cycles, creating trends. The sturdy trends that foreign currencies develop are a significant advantage for traders who use the “technical” ways and strategies.
Unlike stocks, currencies have the tendency to develop sturdy trends. Over eighty% of volume is speculative in nature and, thence, the market frequently overshoots and then corrects itself. As a technically-trained trader, you’ll be able to simply determine new trends and breakouts, to enter and exit positions.
half dozen) YOU do not pay commissions or fees to trade FOREX
Once you trade FOREX, through Fenix Capital Management LLC (FCM) you’ll do it totally FREE of commissions and fees , regardless of your account size.
Fenix Capital Management LLC, needs a terribly low minimum amount to open a brokerage account, only US$ 200 and they are doing not charge commissions or fees to trade or to take care of an account, regardless of your account balance or trading volume.
7) YOU do not should pay trading fees or exchange fees.
There are none of the same old fees, that futures and equity traders are aware of pay:
NO exchange or clearing fees,
NO NFA or SEC fees.
As a result of currencies trade over-the-counter (OTC), via a global electronic network, in FOREX, what you see on your trading screen, is what you get, permitting you to make fast selections on your trades while not having to worry or account for fees that will affect your profit/loss or slippage.
In the equity and commodity markets, you need to pay each a commission and exchange fees. The over-the-counter structure of the FX market eliminates exchange and clearing fees, that in turn lowers transaction costs.
eight) HOW to Forex brokers build cash if they don’t charge commissions?
Like all traded money products, over-the-counter currency trading involves a bid/raise unfold, which represents the costs at that your counterpart is willing to trade. Your broker can receive a half of this bid/ask spread.
Because the currency market offers round-the-clock liquidity, you receive tight, competitive spreads each intra-day and night. Stock traders will be more at risk of liquidity risk and sometimes receive wider trading spreads, especially during when-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. Not like different markets where transparency is compromised (like in the many recent scandals), FOREX markets are highly clear (i.e., analyzing countries, and having access to real-time research / news, is easier than analyzing firms).
As a result of of this transparency, as an FX trader, you may be in a position to use risk management methods in accordance to your fundamental and technical indicators.
ten) Instantaneous Order Execution
The FX market offers the very best level of market transparency out of all the financial markets. As a result of of this, order execution and fill confirmation sometimes occur in simply one-2 seconds.
In Forex, order execution is all-electronic and as a result of you will be trading via an Net-based platform, instantaneous execution is routine.
There aren’t any exchanges, no traditional open-outcry pits, no floor brokers, and consequently, no delays.( will be continued )
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