Forex Advantage (Session 5)
In the Last sessions, I have explained why I choose forex. They are
1) Dual “Direction”
2) A 24-hour market
3) Leverage
4) High Liquidity
Another important aspect of forex is "No one can corner the market". This is because of the large transaction, its high votality, and its 24 hours operation. No bank or any insitution can buy up a sizable currencies and continue to do so for a long period of time. Compare this with the share market, and especially so for just a particular stock.
Added, if you choose your forex broker correctly, you can have additional advantages.
1) No commissions
2) No middlemen
3) No fixed lot size
4) Low transaction costs
Selection of a broker is a research by itself. I will do that in another sessions.
Forex is a very new financial instrument. You don't hear much of it 10 years ago. It is the internet that permit traders like you and me to enter the market with ease. Long ago, transactions in foreign exhange were done by banks and financial institution. They buy and sell in standard lots (or lag) and in dollars (or bucks), basically in large amount. Govenment also trade currencies for political and economic agenda.
Being so new, it is no wonder, people, normal uncle and retiree on the street don't talk about it or know how to go about trading it. The conventional way to trade shares is still via brokers. The internet and the permission for internet-leterate enabe saelf trading and thereby cutting down commissions, no brokers, lower transactions cost. It is the internet that cuts the trading costs, not toforex alone.
Forex, being new also strike fear. Because traditional the transactions is in big amount, the misconception (like shares) it was perceived that you need a large amount of capital. For example, you will probable need $100,000 to earn $10 if the exhange rate move by $0.0001. In actual fact, with margin (I will cover this in another session) and with some brokers offer non-standard size, the above has become a myth.
It was also because of the votality of the market, you will see your profits become losses very quickly. For the faint hearted, this is not good. But with good money management (I will cover this in another sessions), you will know that you can handle greed and fear much better.
This misconception can be corrected via proper education. I have been trading forex for almost 2 years and have learnt the mechanism and know well that the above are myths.
Like all business there are risk. What is yours? Will you get heart attack when you profit $1000 in a minute? What if you lose all your capital?
There are far more advantages in forex as compare to shares, options and commodities. As long as your know the mechanism, it will soon be a walk in the garden. You will be bored as you also stared at the same old currency pair everyday! By then, making a few hundreds dollars a day is just like earning coffee money.
I dared to say that I like forex better than shares and options is because I have tried them.
1) Dual “Direction”
2) A 24-hour market
3) Leverage
4) High Liquidity
Another important aspect of forex is "No one can corner the market". This is because of the large transaction, its high votality, and its 24 hours operation. No bank or any insitution can buy up a sizable currencies and continue to do so for a long period of time. Compare this with the share market, and especially so for just a particular stock.
Added, if you choose your forex broker correctly, you can have additional advantages.
1) No commissions
2) No middlemen
3) No fixed lot size
4) Low transaction costs
Selection of a broker is a research by itself. I will do that in another sessions.
Forex is a very new financial instrument. You don't hear much of it 10 years ago. It is the internet that permit traders like you and me to enter the market with ease. Long ago, transactions in foreign exhange were done by banks and financial institution. They buy and sell in standard lots (or lag) and in dollars (or bucks), basically in large amount. Govenment also trade currencies for political and economic agenda.
Being so new, it is no wonder, people, normal uncle and retiree on the street don't talk about it or know how to go about trading it. The conventional way to trade shares is still via brokers. The internet and the permission for internet-leterate enabe saelf trading and thereby cutting down commissions, no brokers, lower transactions cost. It is the internet that cuts the trading costs, not toforex alone.
Forex, being new also strike fear. Because traditional the transactions is in big amount, the misconception (like shares) it was perceived that you need a large amount of capital. For example, you will probable need $100,000 to earn $10 if the exhange rate move by $0.0001. In actual fact, with margin (I will cover this in another session) and with some brokers offer non-standard size, the above has become a myth.
It was also because of the votality of the market, you will see your profits become losses very quickly. For the faint hearted, this is not good. But with good money management (I will cover this in another sessions), you will know that you can handle greed and fear much better.
This misconception can be corrected via proper education. I have been trading forex for almost 2 years and have learnt the mechanism and know well that the above are myths.
Like all business there are risk. What is yours? Will you get heart attack when you profit $1000 in a minute? What if you lose all your capital?
There are far more advantages in forex as compare to shares, options and commodities. As long as your know the mechanism, it will soon be a walk in the garden. You will be bored as you also stared at the same old currency pair everyday! By then, making a few hundreds dollars a day is just like earning coffee money.
I dared to say that I like forex better than shares and options is because I have tried them.
posted by Ernest Seng at 5:42 PM
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