EbooksForex

Forex or Fx Market offers today’s investor many advantages and here are just some reasons why you might want to become a world currency trader:

• A Market Which Never Closes. Many of the trading markets around the world are situated in fixed locations and operate within strict trading hours, often limited to just five or six hours a day between Monday and Friday. The Forex market however is open 24 hours a day. This means that traders can take advantage of international events and react literally as they happen. If you prefer to work in the mornings then that’s fine but, if this doesn’t suit you, then you can choose to trade during the afternoon, late evening or even in the middle of the night if you want to. Also is very important that you can´t see any gap in the forex market. Only is important to stay close before the friday season ends, because it could be a gap at the start of the monday season (any important financial news in the weekend could move the forex).
• Low Trading Costs. In many markets, like the equity market, traders not only have to pay a spread (the difference in price between buying and selling a stock) but also have to pay a commission to the broker. On small trades this commission can typically be about $20 and this can rise rapidly to over $100 for larger trades. In Forex many of the traditional trading costs are eliminated and you are in affect reduced to paying nothing more than the spread. In addition, the extremely liquid nature of the global currency exchange market means that spreads are normally much tighter than those seen in other markets.
• The Ability To Trade On High Leverage. In most markets where a trader has an opportunity to trade on leverage the leverage offered is often quite low. In the case of equity markets, for example, professional equity day traders will normally operate on a leverage of about ten times their capital. In forex you can trade at one hundred to two hundred times their capital. A downside of high leverage is that it can of course lead to high losses as well as high gains. However, within the foreign currency market, risk management is extremely tightly controlled with the stop losses and high discipline.
• Limited Slippage. In currency trading trades are executed immediately using real-time prices at which firms will buy or sell the currencies quoted. In almost all cases this means that the price you see and the price you pay are the same. In others markets can be often considerable delays between placing an order and that order being executed during which time the price will often move against you.
• Profits easily come trading long position (buying) or short position (selling). Equity markets follow rising and falling trends (cycling between Bull and Bear markets), but the Forex market does not suffer this cycling which comes from structural bias in the market. World currency trading always involves two currencies so that if you are down on one currency then you are up on the other. There is therefore always the potential for making a profit whether the market is rising or falling.