Connect with us
Our website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.


Why Trade Forex?


The purpose of this article is to demonstrate to you the advantages of trading on the FOREX (foreign exchange) market. One myth that I’d like to dispel before I go further is the myth that there is a difference between trading and investing. When investing in stocks you wouldn’t select a stock that didn’t gain profit, when trading currency you are investing in a fund in the hopes to make a profit.

Let’s compare the features of currency trading to those of stock and commodity trading.

Trading Times – Forex trading is conducted 24 hours a day, 5 days a week allowing active traders to choose when they trade. Commodities trading are dependent on the commodity you are trading. The stock market is only available during typical business hours.

Liquidity – The FOREX market is the most liquid financial market in the world around 1.9 trillion dollars traded every day. The commodities market trades around 440 billion dollars a day, and the US stock market trades around 200 billion dollars a day.

Leverage – Depending on your FOREX account size, your leverage may be 100:1. Leverage in the stock market can be as high as 4:1, and in the commodities market, leverage varies with the commodity traded but it can be quite high.

Trading costs – There are not usually brokerage fees when trading forex. Transaction costs in the FOREX market is the difference between the buy and sell price of each currency pair. For both the stock and the commodity markets, there are transaction costs and brokerage fees. Even when you use discount brokers, those fees add up.

Minimum investment – You begin trading in forex for very little money. Investment in stocks typically requires a higher investment.

Focus – 85% of all trading transactions are made on 7 major currencies. In the US stock market alone there are 40,000 stocks. There are just over 200 commodity markets, although quite a few are so illiquid that they are not traded except by hedgers

Trade execution – Trade execution in the FOREX market is almost instantaneous. In both the equity and commodity markets, you are dependent on a broker to execute your trades.

While features make trading the FOREX market very attractive, remember it still requires a lot of education, discipline, commitment and patience. All trading comes with risk and forex trading is consider high risk trading.




Global Banking and Finance Review Awards Nominations 2022
2023 Awards now open. Click Here to Nominate


Newsletters with Secrets & Analysis. Subscribe Now