Foreign exchange or Forex, is the exchange of one currency to another at an agreed exchange price on the over-the-counter (OTC) market. Forex is the world’s most traded market with a giant turnover per day. This means that exchange rate is determined by market forces especially by supply and demand on the international markets. Therefore the characteristics of Forex trading are:-
Other than weekends, the forex market is open 24 hours a day. There is no need to wait for the market to open and you can trade anytime, when you feel comfortable. This flexibility has enabled many professionals to enjoy benefits as an additional source of income. They can trade anytime, morning, afternoon, evening or night, whenever they are free. As a result, no one can monopolize the market.
The forex market is huge and no single entity like bank or government can control the market trends.
In forex trading, only a small margin is required to purchase a contract of higher value. Leverage enables you to earn high returns while minimizing capital risks. However, it can be sometimes double edged sword. Without proper risk management, high leverage trading may result in huge losses or profits. So, it is important to make a wise decision.
In view of huge trading volume in forex market, you can buy or sell currency at desired price in matter of seconds with a simple click of the mouse. You can even setup an online trading platform to buy and sell, so that you are able to control profit margin and cut losses. However, the selection of trading platform should be done vigilantly for fast, simple and reliable execution.
Free! Free! Free!
In addition to free simulation accounts, many platforms also provide news, charts and analyses free of charge. Moreover, you can easily build up trading experience and confidence to find your way to success.
According to trade specialist Barry Sendach, it is important to learn all tit-bits of Forex trading first, to garner maximum benefits. All you need is a computer with the internet access and little passion for trading; you will be able to find your pathway to wealth creation in Forex trading.