The forex market is unique – and as such, it attracts millions of traders daily, who are busy making money online. What’s more, it is open for all investors worldwide. Practically, anyone can trade forex.
What Makes Forex Exceptional?
HIGH LIQUIDITY
Forex is the biggest financial market in the world with a trading volume of over $4 trillion a day. This makes it 53 times bigger than the New York Stock Exchange’s daily trading volume. In such a liquid market, you have instant access to money as you can sell your investment quickly and at fair market price.
TRADING ROUND THE CLOCK
As opposed to any other financial market, the forex market is open 24 hours a day and 5 days a week (22:00 GMT Sunday – 22:00 GMT Friday). You can make your forex deals whenever you are online, and at any time, day or night.
TRADE LONG OR SHORT – YOUR CHOICE
Whether the market is rising or falling, forex offers you continuous profit potential – something the stock market does not offer. Because forex trading is about buying one currency and selling another, you are always free to trade long or short without any limitations.
BIGGER LEVERAGE – BIGGER PROFIT POTENTIAL
While for stocks the typical leverage is 2:1, forex trading allows you a leverage of up to 500:1, or even more! No other financial market apart from forex offers this kind of leverage. You can choose the leverage that suits you best.
SMALL INITIAL INVESTMENT TO START TRADING
You can easily open a trading account with a modest initial investment to start buying and selling currencies. You are free to do this on different levels, depending on your knowledge, skills and risk appetite. Its accessibility is a huge plus!
NO MANIPULATIVE INFLUENCE
The daily volume of forex is huge! As a result, there are no top dogs who can manipulate the prices. Why should your potential profit (or loss) depend on how big investment companies trade? This is something that does not happen to forex.
No hedge funds, banks, analysts or brokers can influence the market for an extended period of time. Not only is forex open to everyone, but it also applies the same rules to all investors, no matter how big they are.
NO MIDDLEMEN
We say that forex is traded over the counter (OTC). This implies that the forex market has no centralized exchange such as a stock exchange. Instead, forex trading is conducted directly between buyers and sellers. Consequently, you have direct online access to the markets without any middlemen charging you extra fees.
VERY LOW TRANSACTION COSTS
Unbelievable as it may sound, the forex market operates without any clearing fees, exchange fees or brokerage fees. Most forex brokers are compensated for their services through the bid-ask spread. This is usually less than 0.02% under normal market conditions. At XM the spread can be as low as 0.01%.
MARKET ORDER EXECUTION IN LESS THAN 1 SEC.
Unlike stock and futures markets, the forex market is very liquid and as such you can always execute an order. At XM we are very proud of our no rejections policy: 100% of clients’ orders are executed in less than 1 second.
FREEDOM TO CHOOSE YOUR TRADING STYLE
It is always your choice how and when to trade. The market is there for you 24 hours a day, 5 days a week. You can be an intraday trader and keep your positions open from a few minutes to hours, or you can be an overnight trader and have a trading horizon of days, weeks or months.
Besides, you can use automated trading and let the expert advisors (robots) work for you. Do you need to leave the comfort of your home to trade forex? No, you don’t. It’s all online, so all you need is Internet access on your PC, laptop, tablet, or smartphone. You have forex within easy reach at anytime.
LESS IS MORE
Over 8,000 stocks are listed on the NASDAQ and the New York Stock Exchange. Instead of analyzing and staying abreast with the developments of thousands of stocks, you only need to concentrate on a few currency pairs to make the most of your trading.
While all this looks impressive, the main advantages of forex trading are more than appealing even to someone who knows little about it. But does it sound like something you want? Let’s be honest, on some level or another everyone is interested in making money – including you.
The more you will read about it, the more tempted you will feel to embark on your most exciting financial activity ever: forex trading.
Nobody becomes a professional forex trader overnight. You can learn all about it by following XM tutorials and by actually doing it.