In the Forex world, changing money is the name of the game. Forex trading, also known as Forex or currency trading refers to the largest financial market in the world in which one is for currency trades another for profits. The top 10 most traded currencies on the Forex market are the USD, Euro, Japanese Yen, Pound Sterling, Canadian Dollar, Swiss Franc, Australian Dollar, Swedish Krona, Hong Kong, Dollar and the Norwegian krone. Currency prices have changed according to supply and demand in the realtime trading. Other factors such as interest rates and the country's financial and political statements can also affect the amount of money. Forex market participants are diversified from many companies and banks to small businesses and even individual entrepreneurs.
On top of that, there are 10 unique Forex trading benefits that draw thousands of merchants from around the world every day. Let's look at them all at once.
1. Transactions can be done every time - Unlike the stock market, the Forex world never sleeps. The 24-hour opening gives merchants a chance to trade any time of the day or night. That said, the level of market activity has changed throughout the day, and any veteran Forex investor will tell you that the best time to trade is when the level of market activity is at its peak (we get that then why a little later). The Forex market is divided into four main sessions. These include New York, Sydney, Tokyo, and London. When one session is closed, there is always another one open; So, keep the market open 24 hours. The busiest time of the market is when the two trading sessions overlap.
2. Highest Renovation - Liquidity is determined by the size of the market (a number of active participants) and the number of transactions (buying and selling money) occurs at a given time. The Forex market is the highest liquidity of all financial markets. Due to the high cost of participating currencies at any one time, the daily exchange is estimated at around the US $ 4 trillion.
Now, keep in mind how in point 1 is it noted that the best time to trade is when the market is at its busiest? Here's why - This peak time is when the fluid is at its maximum. This is when most exchanges occur, which means more opportunities and good deals. It is also when market volatility (currency movement) is at its lowest. It is, therefore, easier to benefit from a marketplace in a short time when the price of money is good. On the other hand, when the lowest level is the lowest, transactions have become very slow and price changes are slow.
3. Actions - In terms of ordinary people, this feature allows entrepreneurs to spend more money than the amount in the business account. It gives entrepreneurs a chance to make big profits by investing a small amount. In most cases, the entrepreneur can choose his own actions. The action is a ratio. Let's say you have $ 500 to invest in your account and you enter a trade with a ratio of 50: 1. That means for every dollar you can buy up to $ 50. Now, as long as $ 500, the stock gives you the opportunity to trade up to $ 25,000.
4. Low Capital - This feature is what makes Forex attractive in many individual working classes. It allows you to start trading with up to $ 100 in the account.
5. High Return on Investment - In Forex, the stock provides a high return on investment potential than any other financial investment such as stocks, bonds, etc. Low-income currencies can produce a high ROI.
6. No commercial commission - Most dealers/brokers do not ask for a commercial commission. Instead, they were paid in an offer / ask for a spread. An offer refers to the price at which the buyer wants to buy money. Ask; on the other hand, refers to the price that the seller wants to sell in the currency. The difference between the two is a spread. Since money is the most liquid asset in the world, it has the lowest spread; Inventories, on the other hand, have a large gap. In the Forex market, the spread can be kept low by still, realtime trading currency pairs with maximum liquidity. Some of them are the Euro and the USD, the Euro and the GBP, and the GBP and the USD.
7. Forex is everywhere - Due to the global nature, the Forex market can be accessed from anywhere. It has no physical location and all changes take place automatically. This allows transactions in minutes. In addition, because of its high liquid state, it can easily generate substantial profits for less time.
8. Forex is a bull market - Bull market refers to a financial situation when the market is on the rise. The opposite is the "bear market". The Forex world, on the right side, is still a bull market. Why? Because at any time, you always find a currency that the price drops. That said, it is also true that each bull market will always have a parallel bear market. Indeed, currencies are always traded in pairs and, for example, if the euro falls in value against the USD, investors in euros will lose money (Bear Market) and investors in USD will receive the figure Bull Market.
9. It's easy to learn - One of the biggest benefits of Forex is that everyone can participate. Yes, it is true that not everyone was born with a financial effort but it is also true that with easy access to the knowledge that the Internet offers, everyone can learn the basics for free. In addition, in Forex trading simulators, inexperienced traders can now get an idea of the real world of Forex without losing their hard earned money. It allows amateur traders to learn the process and prepare their skills by placing fictitious trades.
10. Exit and sell whenever you want - Forex allows you to enter and exit whenever you want. Along with this, through the trading places, Forex also allows you to buy or sell a currency just and there to take advantage of its current price. It also allows you to make a profit by going short (also known as a short sale). That's when you buy a currency and sell it, then return it to a value lower than the one you originally sold it for. This difference is the income you earned. In addition, Forex also allows you to make profits by exploiting the value of money by taking (or making a long sale). This is when the money is sold in a later period for a price higher than what you paid.
Want to make your startup journey smooth? YS Education brings a comprehensive Funding Course, where you also get a chance to pitch your business plan to top investors. Click here to know more.