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Forex Trading and its Many Advantages

Forex trading business is the only business that is open 24X7. There are millions of forex traders all over the globe who do forex trading but newcomers to the business face tremendous risks.

It is important to know every aspect of the process of trading in the forex because the markets are highly competitive and fragile. At times, it can be highly volatile too. Yet, there are many advantages of trading in forex as compared to trading in stocks and futures.

You can also look online to know about option trading strategies for beginners.

The USD/Euro is the most widely traded currency pair. The Bid or Ask spread rates have tightened spectacularly in the past few years. Most online forex brokers offer a spread of five pips on USD/Euro.

In the futures market, the spread can vary anywhere between five and nine pips which can become even larger under illiquid market conditions.

Another major advantage is the trading margin which is usually as low as one percent. In simple terms, a trader can hold the position of a value of USD 1,000,000 even when they have a mere USD10, 000 in their account. While trading in futures, margins are changing constantly.

The third and perhaps the biggest advantage is the ability to trade markets 24X7. You are free to trade currency of any country and across any forex exchange.

Share markets and futures trading have fixed trading hours. There are after-hours trading facility but margins are often low and prices are usually highly uncompetitive.  

Author Bio

Constance Perkins is a content marketing professional at Tissot, an inbound marketing and sales platform that helps companies attract visitors, convert leads, and close customers. Previously, Rodney worked as a marketing manager for a tech software startup. He graduated with honors from Columbia University with a dual degree in Business Administration and Creative Writing.

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