THE FOREX TRADING OPPORTUNITY
Forex trading or FX in short, in the modern era is a wonderful opportunity for private investors to trade directly in different types of foreign currencies.
In the past, foreign exchange was mostly limited to large banks and institutional traders, but thanks to internet and the recent technologies, online forex trading is luckily available to small private traders through a plethora of trading platforms available from forex brokers worldwide.
As we know, all currencies are traded in pairs on a floating exchange rate and more than 80% of the daily transactions are based on the major currency pairs such as: USD/JPY, EUR/USD, GBP/USD, USD/CHF, and they are traded mainly for investment purposes.
If you start a deal thinking that one currency will appreciate against another, but sonn after placing your trade the market turns visibly against you, you can always stop such losing trade and revert your investment the opposite way by either buying or selling the currency involved in the deal and then make a profit from doing so.
Large institutions make their transactions on the forex market mainly through dealers at major banks or through major forex brokers and forex is a necessary part of the world wide market. The forex market is open 24/7 for five days a week and it is reasonable to believe that while at one side of the world people sleep at the other side they are trading and viceversa.
The beauty of this is that even while you are sleeping, if you have placed your trade correctly and made use of the stop-loss and take-profit settings for overnight execution, you can wake up in the morning and find out that you have made a profit out of it.
Price movements on the forex market are generally more smooth and without the gaps that you face almost every morning on the stock market, and if you trade on longer time frames it becomes less risky than trading on a one day basis.
The currency market is the largest and oldest financial market in the world and is the biggest and most liquid market in the world. When you compare FX to the currency futures market you will realize that this latter is only 1% as big as the forex market.
As already said above, what was once exclusive territory of dominating banks and major currency dealers, is now availabe to any small private company and individual speculator who can take advantage of the opportunity to buy and sell currencies from the comfort of home or while on the go thanks to the modern apps for mobile trading.
No investment is too large or too small and many brokers offer trading platforms where it is possible to try and test in demo mode what they have on offer before you decide to deposit your money with them.
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