Even since its rise in prominence back in the 70s. The Forex (foreign exchange) market has quickly become the largest and the most liquid trading environment in the world. Today, with its estimated turnover of $5.1 trillion, it easily outperforms even the behemoths like the New York Stock Exchange with its daily cap of “mere” $25 billion. And yet, whether due to the sheer scale or the fear of passing trends threatening to disrupt the market (e.g. cryptocurrencies). The currency market always seemed too intimidating to up and coming investors.
Here, we are going to put these old fears to rest and give you 6 reasons why Forex should be your first investment option in 2019.
A limited set of products
Although this might not sound too encouraging at first. The fact that the entire Forex market consists almost entirely of only 18 currency pairs (other options are present, but not nearly as prominent). This limited set of options actually takes a lot of chances out of the trading. Unlike the stocks that often force you to make rash decisions and pick between thousands of options. The limited Forex currencies allow you to meet your goals with the use of different strategies, which is, by all means, a much better option.
Opened to inexperienced investors
In its essence, the Forex market is very accessible – anyone who has at least $100 on disposal can become an investor. Also, it is worth mentioning that all the relevant data that can help the traders in making the right trading choices (e.g. foreign relations and national economic trends) are widely publicized and easily accessible. All these facts make foreign currencies a very transparent and egalitarian market where investors’ success depends entirely on their skill and forethought.
Ease of access
The fact that the trade of currencies is a process performed by countless trading companies all around the world means that the Forex market never takes a break. As long as you have an access point, trading can be performed anyplace, anytime. Fortunately, the rise of streamlined software solutions like, for instance, Ever Forex trading platform means this fortunate circumstance can be easily exploited. Just open your app, place your offer in a matter of seconds and continue with your daily duties.
Strict regulations
A person could easily assume that the low entrance barrier combined with the ease of access and the speed of transactions would make Forex market a volatile mess. However, due to the unique nature of the traded goods that can have huge global implications. The currency market is probably the best-regulated market in existence. One of the best examples can be found in the British FCA (Financial Conduct Authority) that goes great lengths to make trading of currencies safe from any kind of malpractice.
High level of liquidity
As we already mentioned, the currency market is incredibly expansive. That means that the chance you are going to end up stuck with the commodity you can’t sell is very small. As a matter of fact, under normal market conditions, the currencies you are offering will be sold almost instantaneously. This high level of liquidity also implies that no matter how large the orders you are placing are. The transactions will be performed without affecting the exchange price of the involved currency.
Use of leverage
Finally, we have to cover the way Forex handles leverage. Namely, unlike some other investment options where you are heavily limited by the amount of your current investment. The currency market allows you to trade foreign currencies with the values one hundred times bigger than the value of the initial investment. Although this trading freedom can be a double-edged sword. It is hard to deny that with the proper risk-management, smaller investors have much bigger chances at higher earnings.
As we can see, even though it is often considered too complicated or risky. The currency market actually makes one highly regulated and accessible trading environment that offers a lot of unique benefits to up and coming investors. If you have previously avoided this option, we say it is time to finally give it a try. Your portfolio can only become stronger the more diversified it gets.
