money Trading – Advantages of Forex

money Trading – Advantages of Forex

Instead of shares, futures and options, more and more people and investors are trading Forex. It is clear that Forex has given traders and investors unparalleled advantages over other investment vehicles. It is because of these benefits, I personally believe that a lot of not-so-well-to-do people can assistance from this market. In this article, we will look in detail the advantages of Forex trading has for wealth builders.

24 Hour Trading

The Forex market is open 24 hours daily. When Asia market is closed, the European market starts followed by the USA market and continued by Asia market again the next day. consequently, this allows Forex traders to take locaiongs in spite of of the time and locations. This is really helpful for those who can’t provide to quit their job and they can earn additional income by Forex part time.

No one can corner the Market

Foreign exchange market is so huge that no single entity has the capability to control the market price for a long period of time. That includes a central bank. There are simply too many participants, ranging from personal traders, commercial edges, central edges and hedge funds.

Extremely Liquidity

As the same reason as above, because Fx market is so great, it is extremely liquid. Under normal circumstance, you can buy or sell the currencies pair at once. Shares however, you might not able to buy or sell the shares you want as there might not be a seller or buyer. There no such thing in Forex.

No Commission

There is no commission and no middlemen which incurred high cost and eat into your profits. Brokers earn their money by pip spread. At the reputable and larger brokers, the pip spread can go lower than 0.1 percent per trade.

Flexibility in Lot Size

In identify FX, you determine your own lot or contract size. This allows a lot of people to trade with as little as $300. Personally, I feel this can help a lot of people who wish to enhance their life but does not have a lot of spare cash. Stock market and futures require a lot of capital to invest, consequently making the wealthy or high salary society to earn more. Middle income group will have problems entering the stock market due to without of cash. It isn’t wise for middle income earners to take a loan for this risk. consequently, FX brokers that allow any lot size helps middle income earners to earn additional money. As long as these people has good and proper education on money trading.

High Leverage

This is important to anyone who wish to trade as a small amount of capital with a high leverage allows you to control a larger contract size. This gives you the ability to make bigger profits and keeping risk under control.

For example, with leverage of 100:1, if you open an account with $100. you are able to control $10,000 contract size. At the same time, by opening an account with $1000, you can control $100,000!

This, of course, can also cause you to lose the amount of money in your account easily if you do not exercise good money management.

Demo account

To me, this is by far the most important of all the advantages. A chance to test out, to try out and to learn any strategies you come across. For free!

By using these demo accounts, not only you can familiarize with the broker platform, you also can practice what you learn using virtual money. Once you gain experience and confidence, you can start open an account and earn money.

With these advantages, it is no surprise why many people are considering and trading profiting from Forex. Although there are some advantages in other markets, for example some company’s shares gives dividends. already so, Forex has more advantages than stocks and futures when it comes to trading.

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