The Foreign Exchange market also known as Forex, is a market where currencies are traded. As one of the most widely used markets, it is the largest financial market in the world. For years, the Forex market has been known as the market that determines exchange rates. Because of this, central banks worldwide only granted access to other banks and in turn, Forex investmenting was too costly and hard to access for everyday investors. In recent times, this has changed and regular people can make money in this marketplace. Here are 5 reasons why Forex investing is an important part of any portfolio.
1. Accessibility
If there is a bank open in the world, chances are the forex market is open. It is a large, growing and liquid financial market that operates 24 hours a day, five days a week. It is not a market in the traditional sense because there is no central trading location or exchange. Most of the trading is conducted through electronic trading networks, permitting market participants to react to economic events and currency movements.
2. Volatility
On the Forex market, you are able to profit in both rising and falling markets. For instance, if you believe the price of your base currency in a chosen currency pair will rise against the quote currency, you can go long and place a buy order. Then with every pip that your base currency rises, your profits will increase. Likewise, if you believe the price of your base currency is going to fall, you can go short and sell, thereby making a profit once again.
3. Communities
Social networks become more and more popular every day, and as Forex is the largest market, it also has the largest amount of trading forums and trading networks. This way, you get to experience a whole community of Forex traders, making Forex the most social market to trade. Many new investors entering in the community each day.
4. Small Start
Compared to the other markets, the Forex market allows trading with a small initial capital. This is mainly because there is no fixed lot size when trading Forex, allowing traders to scale their trade sizes according to their convenience and comfort level, thus making it possible to enter the market even with a small amount of capital.
5. Flexibility
After learning more about what is the best way to trade with our system and plan, you can begin trading fairly quickly. Forex allows you to choose what fits you best: your time of the day, your preferred holding period, your trading style, your account size and your leverage.
Considering this short but powerful list, you can be assured that now is the best time to get started! Contact me and I will show you how to get started!
Sources:
https://admiralmarkets.com/education/articles/trading-psychology/top-10-reasons-why-forex-is-the-best-market-to-trade?#c!=1 © Admiral Markets
http://www.futuresmag.com/2014/04/02/top-10-reasons-trade-fx