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Take a
look at some of the advantages of trading Forex over stocks...
You
can profit in an up or down market. When trading
stocks most of the money is earned in bull markets, which
is very limiting. With Forex, you can easily profit in both
directions, long and short, and make profits on the fluctuation
of the exchange rates between any two currencies. It matters
not which currency is rising or falling in value against another.
Forex
is the most liquid market in the world. Because of
its size, there is never a problem buying or selling a position,
no matter how large. In addition, your funds are not tied
up for long periods as they are when waiting for stock values
to rise. With Forex your account is totally liquid, just as
readily available as your bank account.
Forex
is much more predictable than stocks. Many studies
of trend following systems prove that currency trends are
the most consistent and profitable. Regardless of the type
of trend following system used; long term, intermediate term
or short term, currencies invariably outperform all other
markets including stocks, bonds and other commodities. The
stock market is tiny compared to the vast foreign exchange
market, and technical trading with stocks is not always reliable
because the fundamentals of stocks can change with the wind.
The Forex market is much more reliable and predictable, and
the trends once they begin tend to persist, giving tremendous
opportunities for profit.
No
commissions or exchange fees. There are NO trade
commissions when trading Forex. Brokerage companies instead
make money on the spread (difference between the buying and
selling price) which barely affects your profits at all. It's
MUCH better than commissions! You end up saving a lot of money
on costly commissions when trading Forex.
24
Hour a day market. The Forex market does not come
to a halt each day at the close of business hours like the
stock, equity and commodity markets do. The gaps and erratic
price jumps these gaps in the market cause can cost a trader
dearly. The Forex market never stops trading the entire week
long. Only on the weekends does the market temporarily stop
trading until Sunday evening.
Trade
mini contracts with an account as little as $300.
There is now the option of opening an electronic mini Forex
account which allows you to trade with $100 per trade and
start out by taking much smaller risks than you often have
to take with stocks or equities.
High
leverage. When trading Forex you enjoy up to 50 times
the leverage of trading stocks. In stocks, for every $1,000
cash you invest, you control a maximum of $2,000 worth of
stocks. The maximum leverage is 2:1. But with Forex, if you
invest $1,000 margin on a foreign currency trade, you can
control up to $100,000 in currencies.
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