3 Reasons Why You Should Consider Trading Forex

The Forex Market

3 Reasons Why You Should Consider Trading Forex

Why trade foreign exchange(FX)?

So now you asking yourself why I should trade FX and the answer is simple; because you can! The FX market is the only financial market that you can trade 24/6(weekend excluded), for a reasonably small investment, and profit almost instantly!

The Forex market has not only provided an investor with the ability to trade anytime, anywhere but also with small investments. With as low as $50, you can start trading the FX Market on Brokers like HotForex(Best Forex Broker and Platform for Africans)

More importantly, you can now trade from the comfort of your house on your laptop and mobile device. The same is also applicable to deposit and withdrawals. You don’t necessarily have to leave your room, as you can now pay and withdraw with your debit card.

The advantages of the Forex, FX markets are simple,

1)    Liquidity

2)    No commissions

3)    Leverage

Liquidity

The Forex, FX market is open 24/6, which gives the investor endless trading opportunities and generally no limitations of time. It’s also the largest financial market as mentioned which subsequently gives the investor endless information online (education, information etc.) which is a plus!

According to the Bank for International Settlements, foreign-exchange trading increased to an average of $5.3 trillion a day. This averages out to be about $220 billion per hour. That’s HUGE right.

Leverage

Being a leveraged financial instrument an investor is able to tap into this to maximize profits and at the same time make the most of the market movements without having to hold the full value of the underlying asset.

Investopedia defines the use of leverage as using borrowed capital as a funding source when investing to expand the firm’s asset base and generate returns on risk capital.

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Picture of a Financial Leverage
Image source: Bbtperspectives.com

Let’s look at an example where 1:100 leverage is used:

Investor deposits $1000 into a trading account; with the leverage the client is able to open a trade of up to $100,000(100x initial deposit). The market moves in your favor by 1% and you have just made yourself a profit of $1000!

No commissions

The Forex, FX Market is one of the only markets in the world where trading is commission free (ECN Broker excluded). You only pay the spread (difference between the bid/ask price or buy/sell price). This makes for the cheapest form of financial investment and without commissions and extra costs you can “pocket” more!

Who can trade FX?

Just about anyone can trade Forex, FX- if you are over the age of 18 and have a smartphone or a computer and internet access the only thing left is education.

With adequate education, practice and a good broker, you can profit from just about any day on the market.

Have any questions, kindly put it down in the comment box below. At 9jaCashFlow.com(9CF) we’re commited to making you a better Trader, Investor and Entrepreneur in Africa.

Click here to start trading FOREX on HotForex.com

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