With the economy taking a massive hit due to Covid-19 around the world, a lot of people are looking to expand their income sources and turning to the world of trading. Though all forms of trading including the stocks and the commodity have their own pros and cons, forex trading stands out in terms of liquidity. The fact that daily global forex trading has a volume of about $6.6 trillion means that there are plenty of opportunities to benefit from forex traders.
We take a look at the key benefits of forex trading to help you decide whether or not you should jump into the world of currency trading.
Ease of access for the beginners
While you may need a large sum to invest into other forms of trades to get started, you can actually start forex trading with a few hundred dollars just so you can test the waters. What’s even better is that you get to practice trading in a free demo account such as the one offered by Emporium Capital which simulates the real trading environment so you may get familiar with different trading scenarios.
Now it takes advanced skill and experience to trade like a pro but with minimal investment and demo accounts you can get the basic hang of the forex trading.
The long trading hours
One of the key advantages of forex trading is the fact that one can trade 24 hours a day. Trades are made directly between the parties with the facilitation of a forex broker which means forex trading is not subject to the opening time of a particular market. One can make a trade so long there is a market open somewhere in the world.
So, regardless if you work a day job or you are committed to trading, you can always make a trade at your convenience.
Low cost of transaction
A key point of concern among traders is the high transaction fee. In case of forex trading there are very low transaction fees especially if you transact through a non-dealing desk broker. The transaction fees in this case are directly associated with the spreads which are quite small.
Forex market is highly volatile which means there is more opportunity and more profit to be made. One might argue that such volatility could also go against your interest but the truth is, value of a currency is associated with several factors such as local and global economic stability, news events, security and political situation of a country most of which are foreseeable.
All it takes is a good research about the currency pair you are planning to invest in to significantly reduce the chances of taking a fall.
Forex trading hugely relies on connectivity due to its decentralized nature. The recent advancements in technology have only empowered the forex traders to trade more conveniently in real time from anywhere in the world.
From desktops to your mobile phone there are highly sophisticated trading apps available for each platform.