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The Forex is a 24 -Hour a day, 5.5 days a week continuous financial market
You can trade forex whenever you want, day or night, this market never closes its doors. Most forex brokers offer trading starting Sunday around 6 PM through Friday 4 PM Eastern Standard Time. This is a very big advantage over stock trading with its limited trading hours and opening gaps. Forex gaps are very uncommon.
Big liquidity when trading forex
The currency market is very liquid with over 1.9 trillion changing hands daily, as a trader, it means you can buy and sell currencies whenever you want at ANY market price. You can set limit and stop levels on your open position, the trading platform will automatically close you position when one of those targets are reached.
No one can control the currency market
Not even a central bank can take control over the forex market for a long period of time because this market has millions of participants, even central bank interventions are short lived. At the stock market, prices can be manipulated very easily by market makers and stock brokers.
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Commission - Free market
Most forex brokers offer commission - free currency trading, the only cost is a tight spread, for example 3-5 pips on the major currency pairs. Stock traders often see large portions of their gross profit go to stock brokers in the form of commissions, and the exchanges in the form of exchange fees.
High leverage market
Get better returns will smaller sized accounts, you no longer need millions to make money trading since forex traders are allowed to trade currencies on a (high) leveraged basis. You can trade up to 200 times your capital. An investment of US $2,000 controls US $200,000 of any particular currency pair. Please note that high leverage without proper money management can lead to large gains as well as losses.
Make money in both falling and rising markets
You are allowed to trade currencies during falling, sideway and rising markets, for example, when you buy the EUR/USD pair, you are simultaneously buying the EURO and selling the USD. When you "short" the market, there's no need to wait for an uptick.
Auto margin watcher
Margined equities- and futures trading can be very tricky because you can be liable for more then your original deposit. At the forex, your open positions will be closed out automatically if you fall below the margin requirement (depends on the broker).
Free charts and News Plugs
Most currency brokers offer free charts, trading platforms and news feeds to their clients.
Technical analysis works
Technical analysis works better because currency pairs trend better, they rarely spend much time in tight trading ranges, a technically trader can easily identify breakouts, new trends and sideways trading. |
