There are many reasons why you should consider investing in foreign exchange. And if you are not sure whether or not you would actually be able to benefit from it, you’re about to be blown away by the facts. As professional Forex brokers, we know the industry like the back of our hands, and can guarantee a solid investment, if you know what you are doing.
In this post we take a closer look at some of the advantages you can expect when you decide to join the bandwagon and start trading Forex.
1. No Middleman
When you opt for spot Forex trading, you won’t have to deal with a middleman. You get to trade directly with the market that sets the pricing for specific currency pairs. What this means is that your Forex broker is always the counter party to your trade. You do not have to go through a clearing Futures Commission Merchant or some other middleman for your Forex trading.
2. Affordable Investments
The barrier to enter the Forex market is extremely small. A lot of Forex brokers now a days actually allow you to deposit with as little as $5-10 to get started. This is in stark contrast to exchange traded products that typically have minimum requirements of several hundred or even several thousand dollars.
3. Affordable Transactions
Most Forex brokers make their money in one of two ways. Either they simply apply a markup to the bid/ask spread, or they show a raw spread they receive from their liquidity provider and then charge a commission. These types of accounts are generally referred to as ECN style accounts. Overall though, trading Forex is typically much cheaper than trading on exchange products such as Futures or stocks.
4. Always-On Trading
Forex never sleeps. The market is open 24 hours a day 5 days a week, from Sunday at 5pm EST to Friday at 5pm EST. That means you can keep your eye on your investment whenever you want, wherever you are. It allows you to trade whatever time you have available to do so.
5. Requires Little Capital
While there are many options out there, whichever one you select will prove to be very affordable in comparison to other markets. Forex brokers also offer smaller accounts which enables you to start trading with as little as $5-10.
6. Profit Potential in All Markets
Unlike stock exchange trading, Forex allows you to both buy and sell. Stocks are very different as there are a host of short selling rules and pattern day trader rules that really prevent you from trading the way you might want to trade. Forex on the other hand though does not have these same rules, you can buy and sell anytime that the market is opened, and you are not required to hold your position for a certain period of time so as to not violate exchange rules.
7. No One Controls the Market
The Forex market is massive with approximately $5.1 trillion dollars in circulation. There is no single entity or person that can control or influence what happens in the market as it solely relies on geopolitical and economic factors.
8. High Liquidity
Thanks to the massive size of the Forex market, it is also very liquid. This means that no matter what, you’ll always find buyers and sellers on the market.
If you ever had any doubt about whether or not investing in Forex could be lucrative, your concerns should all be answered by now. As you can see there are loads of benefits you can expect when deciding to invest in Forex.
Need some advice to get started? Delma Exchange UAE is ready to help! Contact us for any of your Forex trading queries. You can also visit investing.com for their real-time forex analysis and some spot-on insights on the market.