The Benefits of Forex Trading

by Redeeming Riches on February 15, 2018

In recent years, trading has become increasingly more advanced, and as such, anyone with an internet connection can now start trading.  If you’re thinking about trading, the first question you need to ask yourself is the type of market you would like to trade in.

The commodities market continues to have a significant economic impact on nations and a number of different industries including metals, livestock, energy, and agriculture.  In fact, choosing to trade in commodities has recorded favourable returns in the long-run, especially in categories like precious metals.  You may consider trading in commodities, however, the advantages of Forex cannot be overlooked.

What is Forex Trading?

Over the years, many people have conducted successful trades and enjoyed the benefits associated with trading on the active Forex market.  The Forex market is becoming increasingly more popular as time goes on.  Here, we’ll explore why Forex is such an attractive option for traders.

Size

The size of the current Forex market is unprecedented and unmatched by any other market.  It is estimated that an average of $4 trillion dollars is traded daily in the Forex market.  This is probably what initially attracts new traders.  What helps keeps things interesting are the following features.

Accessibility

One of the benefits of trading on the Forex market is that it is open around the clock.  This means you don’t have to worry about waiting for an institution to open, as you’ll easily be able to trade from the comfort of your own home.  In fact, the Forex market is accessible to anyone with an internet connection from anywhere in the world.

Volatility

It is vital that novice traders are aware that the Forex market constantly changes.  Not only does it constantly move, it also makes large movements.  This means that this trading option can be highly volatile.  For example, large fluctuations in the value of the Pound can be seen as Theresa May made some of her most famous speeches.  In fact, after May’s Brexit Date Speech on 3rd October, the Pound fell to a three-year low against the Euro by over 1%.

Profitability

As the Forex market is a two-way market, traders will be able to profit regardless of the direction the market is heading.  In fact, there is a lot of money to be made in the Forex market, even when the price of your currency is decreasing.  In the Forex market, you always work with pairs, so if one currency decreases, that simply means the other is increasing.  As you can see, there is always the possibility to profit from Forex trading.

Transparency

When it comes to the Forex market, you get exactly what you see.  As long as you take the time to do your research and analyse charts and news, you should experience very few surprises.  If you know what you are doing, you can often predict market trends with a relatively high accuracy rate.

As you can see, Forex trading is incredibly fast-paced.  This means you will have to dedicate time to keep up-to-date with the market on a daily basis.  According to a new study conducted by ETX Capital, the top economic forecasters are usually accurate within a 0.33 percentage point of the final figure.  This makes it extremely worthwhile to look at different forecasters, as you’ll be able to look out for any potential new trends.

 

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