There is the stock market and there is the foreign exchange market. The latter is considered the bigger opportunity-if you know how it works and if you have the money to invest. There are a lot of motivations these days why people are flocking to find out the ins and outs of Forex trading.
But why get into Forex trading anyway? Are there any truths behind the big profit boon we all keep hearing about? These points are the prime motivations why the Forex market is so huge just now:
Boundless activity. The foreign exchange market is open 24 hours on weekdays. As opposed to other markets that operate at specific hours and days, the Forex market is a buzz of activity and opportunities in the week. Investors can react to detailed changes and trends that happen within the week, anytime.
Freedom. This also means freedom from normal office hours; traders can operate any time they wish. Clearly, this draws individuals from other lifestyles, locales and classes. If you have a laptop, then you can trade no matter where you are.
Less cost. Add the purely liquid nature of the market and the electronic way of working in it then you would have a feature that will undoubtedly attract individuals: the lesser trading costs. We can do away with the more traditional costs that add up to your bill and concentrate on only the spreads. The spreads here are usually scaled-down than the spreads in other markets, and that would mean better profits.
Leverage. In contrast to other markets where leverages are small, Forex trading enables for bigger leverages, giving you the chances to trade up to a hundred times your investment. Brokers have options where they can give you a lot of leverage based on the account. Of course, this also means a larger risk of losing money. Risk management protects you from this.
Stable price. Since your trade is done immediately, chances are the prices you saw are what you are going to get. Compared to alternative markets, where your transaction often ends in a span of a day or two therefore offering a possibility for the price to slip and change. The stability and speed attracts a lot of traders in this market. Your assets are not tied up for long periods, offering you more control.
Transparency. Being electronic in transactions and having liquid, movable assets is simpler to analyze and manage. Everything can be accessed by your platform and laptop. Your opportunities can be executed as per your viewpoint and tactics. This gives you a better feel of the market cycle, making your predictions more accurate each time you trade.
Stable profit chances. Since your trading involves two currencies and not other markets and trends, one usually has the opportunity for profit. There is no bulldog watching of rising or falling of markets, goods and industries. Even if the market is bullish or bearish does not really need to worry you. What really matters is that you pick the best currency to trade.
Forex trading is considered the perfect competition for logical reasons. Everybody is presented with an equal playing field. Even if the currency is falling, it just means that there is currency rising somewhere and the opportunity of profit exists. An unlimited earning potential, the freedom, and the even opportunity makes the foreign exchange market an exciting opportunity for anyone.