Why Forex trading business is a unique profession?
21 July, 2021
What is your reason to be a Forex enthusiast? Why do You Want to trade Forex? If your answer revolves around earning money easily, most probably you don't know about the basic advantages of Forex trading. There are many other platforms and ways that enable people to earn money more easily than that of the FX market. What makes it unique and one of the most popular trading environments has less to do with earning or making a profit.
Suppose you are interested enough to know about them. Continue to read this article:
What Makes Forex Trading Unique?
There are literary hundreds of facts and features that have made the Forex market not unique, also the most popular and biggest exchange platform in the entire world.
Let's venture through some of the primes:
1. High Liquidity
Forex is the most prevalent and the biggest economic market in the world and deals with a trading volume of over $6 trillion every day. This makes this around 53 times bigger than that of the New York Stock Exchange. With a market that liquid, you can have immediate access to money and so you can sell your investment abruptly and at a reasonable market price.
2. Round the Clock System
There is a general saying that the FX world never really sleeps. It remains open for 24 hours a day, 5 days a week. Traders can reach the market from wherever they live and whenever they want. None has to restrain himself within any type of time restriction.
Forex trading initiates with the opening of the Sydney session and closes with the NY session. The closing time of the NY session is the opening time of the Sydney session. That means the world of Forex never stops spinning. Traders can approach the market actively or passively by their schedule- be it noon, morning, or night.
3. Less or No Commissions
If you start trading the listed options with a small lot, you will never think about the commissions. Even if you trade with a big volume, you have to pay a small number of commissions. The market also doesn't require any kind of exchange or clearing fees. Retail brokers through whom retail traders join the market don't demand extra money or commission. Because there is another competition taking place behind the curtain. The brokers are always in a fight to attain more customers. They provide their services at the least possible rate they can afford.
They can do it because brokers use Spread. The difference between the bid and the asking price is what we call the Spread. Spreads offered by different brokers have only a nominal difference. That's why the Forex is the most cost-effective way to trade for traders.
Traders can expect to make a huge profit by investing a small amount of money. Anyone can borrow money from a broker and buy 100 and even 500 times larger positions with that. If things follow the right direction, they can expect profit against that larger position. So, leverage is a luck-changing tool for traders.
The system has a giant lick, though. If things go wrong, the traders have to pay the ransom of equal size of the position. That will be equally life-changing, but only in the opposite way.
5. Installment of a Demo Account
Unlike many other people's illusionary misconceptions, Forex is the name of a giant system. People need to spend several months learning the entire system. The system is not the proper word to explain the way of foreign currency market because the market getting influenced by hundreds, if not thousands, of factors.
Theoretical learning can cover the required knowledge to handle the works associated with an inert or systemic environment. To deal with a live environment, people must need more than theoretical knowledge. They need a facility that will let them feel the actual environment and play with the same tools without being threatened with losing money. Forex offers a similar facility named a demo account.
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