THE LOWDOWN ON TH FOREX MARKET
The Foreign Exchange market, or Forex Market is literally the largest and most liquid market place in the world. This is the place where you can literally create millions for yourself, if you use proper professional trading strategies. This marketplace has both the leverage and the accuracy to transform your trading career. Forex accounts for about $3 trillion dollars in trades every single day. That’s more than every single asset class – bonds, stock, equity markets – combined! So, why trade in Forex? The Size of the Market The sheer size of this marketplace means you get the versatility you don’t get from trading stocks – you can easily execute your trades at any time and the cost of dealing is low. This means unlike stocks where a larger number of trades would mean a higher price, in Forex it doesn’t matter how much you trade, the cost stays fixed. Another benefit is that the highs and low spikes you would normally expect from speculators in stock is smoothed out because, again of the large size of the market. This means your trades are highly accurate as well.
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The Market Never Sleeps It doesn’t matter which market you’re trading in, you don’t have to follow the schedule of someone else. You pick the strategy that suits YOUR time, early in the morning or late at night, there’s setups that will fit your preferred working hours.
The Market with NO Gaps Unlike the Stock market – the Forex market does not gap. A gap is a space on a chart where no trading takes place, leaving literally a physical white space on the chart This is dangerous. Let’s say you bought some shares in a company but discovered a week later that the company is having problems and releases a profit warning. The gap could be 10%, so unless you used a guaranteed stop loss you would take a whopping 10% loss on the trade. Now this is well known to stock traders and it is considered ‘market risk.’ This gap does not exist in the Forex market. The Forex market is completely seamless (except from Friday evening to Surday evening when there are no trades). This means you can trade the market non-stop without the fear of getting ‘gapped-out’ of your trade.
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The Market with Low Dealing Costs The price difference between what you buy and sell at is important. A big difference would mean that if you buy something and immediately decide to sell it back, you would have to come up with a higher out-of-pocket cost of dealing. In stocks, the difference between what you can buy and sell your stocks (the spread) is controlled almost exclusively by market makers. The spread changes often, and is a reflection of the amount of stock available at any given time. If there are lots of buyers and sellers for that particular stock, then clearly the dealing risk is lower and the resultant cost of dealing is lower.
However in the Forex market, the spread is unaffected by market condioons. The spread is always fixed, so you always know exactly what prices you are dealing at. That’s because, as said before, there are no size restrictions in the Forex markets. All these reasons make Forex trading a highly attractive investment and cashflow strategy that anyone can absolutely learn and use to generate a very lucrative income stream.
Success Resources: http://www.srpl.net/