Trading in the forex market has gained much popularity over the past years. If it may be a question is why Leary traders from all over the world forex market as a good opportunity to invest? Here we will try to answer this question through this article. Also we will discuss the differences betweenthe forex and stock market and futures market .
Some of the features of trading in the Forex market include :
High liquidity .
Liquidity is what really makes the Forex market different from other markets. Forex market to end long considered the most liquid on the level of the financial markets all over the world, where it is a trade value of $ 2 trillion on a daily basis. This ensures price stability and good execution of trades. It allows investors to open and close their transactions with ease . Also this stunning volume of trading volumes makes it almost impossible to be able to any individual or entity of market manipulation on a large scale .
Market works 24 - hour .
This is also one of the best advantages of trading in the forex market , which he was working on throughout the day. The market dealings opens on Sunday at 3:00 pm EST , the United States and while it opens the New Zealand Stock Exchange dealings, while closing on Friday , five pm EST , the United States and that while San Francisco close dealings. There are also transactions take place almost in all time zones , which allows traders to choose the right time for them to trade .
Leverage .
Trading in the forex market gives enormous purchasing power than most unimaginable in any other markets. Some Forex brokers offer leverage up to 1: 400 you retain any investment does not exceed 0.25% of the volume of trade margin. For example, the rolling crane which uses 100: 1 means that he could have opened the trading center of a hundred thousand dollars just by using the balance in his account does not exceed athousand dollars .
Low transaction costs .
Almost all forex brokers offer their services without charging any commissions. The only cost borne by the trader in the forex trading is what iscalled Balasebred (and represents the difference between the purchase price and the selling price of any of the currency pairs) this same Alasebred have no more than one point ( the minimum difference in any pair of currency) in some couples .
Low minimum investment .
Forex market requires small size of the capital has no parallel in other financial markets. The amount of the initial investment may not exceed $ 300, depending on the sophistication of financial services of the mediator. And this is a wonderful feature on the basis that Forex traders can reduce the risk of their investments to a minimum .
Specialized trade .
Market liquidity will allow us to concentrate on the limited number of trading financial assets (or currency pairs) as a target head of investments (85% of all trades made on seven major currencies pairs). It is what allows us monitoring until the end to get to know more closely on all assets .
Trade from anywhere .
If you travel a lot , you can be traded from anywhere in the world as soon as you have a connection to the internet .
Some of the most important differences Pepin forex markets and other financial markets will be explained below .
Forex market compared to the stock market
Liquidity
Forex Market: The daily trading volumes approaching two trillion dollars .
Stock market: about $ 200 billion are traded on a daily basis .
Trading Hours
Forex Market: twenty - four hours a day, 5.5 days a week .
Stock Market: Monday through Friday from 8 text EST until the fifth with the same time .
The possibilities or the odds
Forex Market: You can make a profit in both directions either bullish or bearish market .
Stock market: most or most traders and investors earn only during the rise of the market .
Transaction costs
Forex Market: Without any transactions and using only limited price Asebred .
Stock market: huge commissions and fees for transactions .
Purchasing power
Forex market: Leverage up to 1: 400 .
Stock Market: leverage ranging from 1: 2 to 1: 4 .
Specialization
Forex Market: Most of the trades (85% are on the following major currencies (US dollar, euro, yen, pound, franc, Canadian dollar and Australian dollar .)
Stock Market: more than 40,000 shares to choose from .
Forex market vs. Futures Market
Liquidity
Forex Market: The daily trading volumes approaching two trillion dollars .
Futures market: about $ 400 billion are traded on a daily basis .
Transaction costs
Forex Market: Without any transactions and using only limited price Asebred .
Futures market: huge commissions and fees for transactions .
Margin
Forex market: a fixed rate to the sidelines with all trading orders .
Futures market: varying degrees of trade margins vary depending on the timing of trading , where those that are available in the morning for its counterpart in afternoon trading vary .
Implementation of trades
Forex Market: immediate implementation of the orders of trading .
Futures market: implementation is inconsistent transactions .
All of these things have made the forex market attractive place for investors and traders, although I would like to draw your attention to it is important , which is that in spite of all the advantages of forex trading , it still enjoys a good reputation; Where it remains difficult to achieve one 's areal success of this valuable market, which a lot of education, discipline and commitment and also requires patience, just as is required in other markets .
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