These days, because of the advancement of the Internet, and the availability of affordable broadband Internet connections, it is possible for people to start online businesses, work online, and even trade to make money in the financial market.
If you are thinking of trading in the financial market, you might want to consider trading in Forex (Forex is the acronym for "The Foreign Exchange Market"). This market concerns itself with the buying and selling of the currencies of just about every country on earth. This market is BIG! So big, in fact, it's hard to wrap your mind around the size of it -- Nearly 5 TRILLION Dollars Per Day! (Yes, Trillion!) Try picture it another way - The New York Stock Exchange (NYSE) has a daily trading volume of about 50 billion dollars. That means the Forex is 100 times larger than the NYSE! In actual fact, the daily volume of the Forex is TRIPLE the size of ALL other investment markets combined!
Despite its size, the Forex does not have a physical location or a central exchange. It operates through an electronic network of people, banks and companies that specialize in trading one currency for another. Nearly all Forex trades are executed on the Internet by someone sitting at a computer with a high-speed connection.
Since the Forex does not have a physical location or a central exchange, it is able to operate on a 24 hour basis leapfrogging from one time zone to another across the major financial centers of the world. This market is open 24 hours a day, six days a week from 5:00 PM Sunday (East Coast Time) to 4:00 PM Friday (East Coast Time).
Why Forex Trading?
1. The Forex Market Is The Most Liquid Market On Earth - Except for Saturdays, you can enter or exit the Forex market anytime night or day. The market has virtually no gaps whatsoever and your stop-loss orders are almost guaranteed. Imagine this -- Multi-Trillion dollar liquidity, combined with 24-hour trading access that virtually guarantees your stop-loss orders will be executed without slippage. Whereas the the other financial markets - stock, futures and options markets cannot offer you this kind of guarantee because the limited trading hours create frequent gap opens.
2. No One Can Corner The Forex Market - The Forex market is so huge and has so many global participants that no single individual nor entity, not even a central bank, can control the market for any significant period of time.
3. No Insider Trading - Due to the vast size of the global Forex market and its non-centralized nature, there is no chance whatsoever for disruptions caused by insider trading. As a matter of fact, there is less chance for fraud in the Forex than in any other investment market. Best of all, forex can never become zero but stocks can become zero and majority of the options expire worthless.
4. Very Low Retail Transaction Cost - There are no commissions. Yes, you read it right. No exchange fees, no closing fees, no government fees, no brokerage fees. This all adds up to a very low retail transaction cost. If you select your broker properly, your round-trip transaction cost could be as low as .07 percent!
5. Trade With A Very Low Margin - You can trade Forex with a very low margin with relative safety compared to the disastrous potential of margin trading found in other financial markets. Also it is a tax-free income if the country you reside has no capital gain tax.
6. If you get really great at Forex trading, your potential financial reward is so big it can make your head swim.
Is there Any Downside of Forex Trading?
Of course there is. Trading in Forex can be very speculative in nature, involves considerable risk. If you are not careful, the Forex market can easily wipe off all your savings. Therefore, before deciding to participate in Forex, you should carefully consider your investment objectives and do not invest money you cannot afford to lose.
How To Become A Successful Forex Trader?
Answer: Education. You must educate yourself properly so that you can put the odds more in your favor. You need a Very Experienced Mentor.
Stay tuned. More about Forex in my future posts Labeled Forex.
Tags: Make Money Online Forex
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