What Are The Advantages Of Trading Forex?
In any form of investment, it is evident that, if you take higher risk, the returns could be higher
as well. In Forex or currency trading, the risk is high but the immensely liquid market gives
ample opportunity for making a good profit if you are aware of the techniques of trading
Here are 5 top advantages of trading Currency/Forex –
1. Incredibly liquid:
In the trading arena, Forex is one of the most liquid investment
vehicles as one can turn it into cash with minimal changes in price. The time taken to
convert Forex into real cash is also very short.
2. Leverage Market:
With just 1/50th of the trading amount as capital, you can enter and
trade in this market which is a huge benefit for the beginners who are looking to start
trading in Forex market but have a small amount of capital in hand. For example, you
can trade $10000 Forex with just $200 as capital.
3. You can choose any hours to trade:
It is a market which is open 24 hours for example
when the market in Wall Street’s closes, the Asian markets open followed by European,
African and Australian Markets.
4. Cost is low:
The cost of trading currency in a global market is comparatively lowering
than other types of markets as the cost depends on the spread – the difference
between the buying price and the selling price of the currency in the market.
5. No restriction:
If you think the currency value going to increase in the international
market, go long and there is no boundary on directional trading and you can go short
when the price is going to fall as estimated by you.
It takes an experienced trader to trade forex efficiently as there are lots of techniques involved
to analyze this market which is extremely fast and profitable but risky at the same time.