Monday, September 7, 2009

What are the benefits of forex trading

# Two way opportunities, that means you can earn either from upward or downward price movement. Example if you buy and the price moves upward, you will gain some profit. On the other hand, if you sell and the price moves downward, you will get some profit.

# Extreme liquidity of the market. Forex is the most liquid market in the world, and that means you can buy or sell anytime you want.

# Long trading hours, Forex allows you to trade 24 hours a day and 5 days a week.

# Leverage to amplify your profit, you can use a relative small quantity to trade bigger amount (usually from 1:50 up to 1:500) for example you have $100, without leverage your profit is only $0.01 but with 1:100 leverage your profit will be $1. (leverage makes your profit 100 times bigger, this also applies to loss).

# Free of comission, Relative Low Spread Cost, usually online forex brokers offer you comission free trading, no brokerage fee, no exchange fee, and smaller trading transaction cost.

# Flexible Trading Lots, you can trade rather standard lot (100K), mini lot (10K), or even micro lot (1K)

# Automated / Robot Trading, some trading platform such as Metatrader enables automated trading