Lets talk about Forex.
I am sure you heard of Forex. I has been around for so many decades. You must have hear it from friends or anyone around you.
Forex (Foreign Currency Exchange Market) has been used by international banks and large investment companies for years to make millions of dollars. However, with easy access to the Internet, it is now possible for anyone to take advantage of this powerful tool and make money the same way large institutions do, even with minimal startup funds at hand.
Even experienced investors seem mystified by Forex and have very little understanding of it. Forex is not much different from the Stock Market, often the same or similar techniques can be used to trade currency as is used to trade stocks and commodities. What make Forex so mysterious is the lack of available information and opportunities of training.
Why invest in forex
I have listed 10 good reasons why I prefer Forex to the Stock Market or any other investment option and why any individual, or small investor, should look at getting involved with Forex:
1. A 24 hour market. You don’t have to worry about running out of time because the Forex is open 24 hours a day, nearly all week.
2. Huge liquidity. Have you ever got stuck trying to get rid of some stocks or options? With Forex, there are always buyers, thousands of them!
3. No commission on your trading. This is specially important for individuals with small amount of money to invest. When using other investment vehicles the cost of the investment is often prohibitive no matter how attractive the investment itself is. Brokerage and other government fees can easily eat up your profit even before you completed a transaction. With Forex, there are no brokerage, government etc fees involved.
4. Low transaction costs. Typically less than 0.1%!
5. No middleman. The investor is dealing directly with the Market.
For other points..
6. Instantaneous transactions. Forex is fully computerised and transaction can be completed in as little 2 seconds. The investor does not have to wait for trade confirmation to arrive by email, worst yet, by post. All ‘paper-work’ is in electronic format, easily viewed, search, analysed.
7. Huge leverage yet low margin. Both increase your profit. In most cases leverage of 10:1 to 100:1 is the rule not the exception.
8. Minimal startup requirements. Again very important for individual or small investors. With Forex it is possible to start trading with as little as $300.00 dollars!
9. Easy access to the Market and your accounts, online, 24/7. Since Forex is completely computerise, anyone with Internet access can trade online and easily access their account and trading history. Most trading platforms allow the user to export this information to other third party software for storage, graphing, analysis etc.
10. No insider trading. Because of the way Forex is ‘de-centralise’, it is almost impossible for anyone to fraud the system.
I could go on for ever about Forex, it is an amazing tool for investors and also a very exciting opportunity for individuals. I hope you’ll catch the fever, too. It is never too late to get to it.
Uniqueness of Forex
There are so many types of investment opportunities. For those that are looking for an exciting way to invest – Forex definitely delivers. Forex stands for foreign exchange and it is the worldís largest financial market.
Forex is quite different from investing in the NYSE or NASDAQ because Forex takes place at dozens of locations all over the world. In fact, most traders are day traders that trade from home. While this form of investing can be risky, it can be extremely profitable.
Forex trading occurs 24 hours per day (except on weekends). One of the things that make Forex unique is that you arenít buying a currency or selling a currency, you are actually trading one currency for another.
Knowing forex in depth
While Forex seems very easy at first, it can be extremely complicated and risky. There are tons of tools online that can help you climb the steep learning curve and for those that do, it is possible to make a very, very good living.
Forex is an interesting investment for some because of the amount of leverage one can have. Some Forex trading brokerages allow their member accounts to leverage the amount of currencies they purchase by 10, 25, 50 times or more. This means with an initial investment of $1K, you can theoretically control over 50K of currencies in some situations.
While this can lead to large profits, it can also lead to financial ruin if you make the wrong decision on a trade. One of the ways that many investors learn to trade Forex without risk is to use the systems simulation platform.
Many Forex brokerages have a simulation platform that is identical to the normal platform and uses current, real world data. This way, if you are just starting out and make a mistake on the simulation, it won’t cost you a dime.
Characteristics of forex to know about
Forex can be extremely fast paced. While many investors are those that are day traders looking to make a quick buck each day, others trade for the long term, looking for long term trends that are much less riskier and can return much more than a day trade. Whatever your strategy, Forex can be an excellent way to invest.
It should be noted that almost anyone can trade from their computer and with a limited amount of investment, however before you trade, get to know the system you trade on and the dynamics of the foreign currency market.
With over $1.5 trillion changing hands daily, it might be advantageous for you to investigate the extremely lucrative business opportunity involving currency trading.
Once the domain of major banks and corporations, this field is now an open playground for the ordinary individual.
The following information gives you a comparison of different investment opportunities in comparison to Forex trading Forex could be the perfect opportunity for you if you are willing to have an open mind and investigate.
Equities are dependant on variable factors regarding when to buy and when to sell. With Forex, the opportunity to buy or sell is always present.
Understanding Futures & other investment
Futures require a person to pay exchange fees as well as commission charges. Forex requires no commission charges or fees. Futures also limit to specific trading hours, whereas Forex is not limited and is available 24/7. Also, with Futures, once a person buys they are basically lock in for a specific amount of time.
Forex Offers flexibility to change position within seconds at the onset of any variable which could effect the particular economic security. When a late breaking news or factor is announce, bam trade is make within seconds.
Real Estate can be devastating to the novice and often requires larger amounts of investments. It is also volatile with the factors which can affect the buying and selling. Ask any real estate investor; they all can tell you the horror stories. The emotional strain of a lingering negative tenant is enough to make any investor throw up their hands and run for the hills.
The reality for other forms of investment
An investor may often have money tied up in an investment for several years depending on the situation involved. Although real estate has been up in value for the past few years, many now believe the market has bottomed out and value is growing at a snailís pace.
Many investors often have to wait on approval from banks in regards to financing or releasing money for financing; therefore, an investor may have his money wrapped up long-term. Forex is extremely flexible.
CDís and Savings Accounts offer security but with little return on the investment dollar. With Forex, a sharp trader can often multiply his investment many times over.
Annuities are mostly safe for the long-term, but if an investor needs to pull his money out for the short term, he may have to pay surrender charges which can range as high as 6-8% if withdrawn within the first 6 to 8 years.
In his article entitled, Are Annuities a Worthwhile Investment, Don Taylor, Ph.D., CFA (bankrate.com) states that most investors would be better off considering annuities as a last resort rather than a first choice when it comes to creating an investment portfolio.
There is a learning curve with Forex; however, the investment in time may pay multiple benefits in terms of investment. There are many avenues to achieve wealth, but few as flexible and lucrative as Forex. With a 24/7 timetable, a person can be in business starting with just a few hundred dollars, the right training and a computer. This flexibility allows a person to work from the comfort of their own home and be in control.
Learn on other investment strategy here.
For more info on forex for beginners here.