Posted by admin on October 18, 2012
Online currency trading is increasingly popular all over the world, and thanks to the internet it’s easy for anyone to trade forex from any location, at any time of the day or night. It’s also become simple for anyone to learn about currency trading, thanks to the huge range of tutorials and guides available online.
Becoming a profitable trader may take time, but one of the main benefits of the forex market is the ease with which you can learn. You don’t need to sign up to expensive courses – all the information you need is available online for free. Likewise, to trade all you need is a computer and an internet connection so the barrier to entry is very low.
The forex market allows you to trade on margin, meaning that effectively you’re able to trade far larger sums of money that your initial outlay. Because of this, even small movements in currency prices can lead to big profits or losses. The forex market is attractive because of the size of profits available, but it’s also possible to lose more than your actual deposit.
Global currency markets amount to trillions of dollars in trades every day. This liquidity and opportunity is unique to the forex market, again making it very attractive to investors. You can make profits when the market rises, but also when it falls – all you have to do is pick the correct trades.
Of course, it helps if you have a lot of information to hand. Data on currency prices is available in real time through services like TradeStream, so you can see from your trading platform exactly how the market is moving. You can also get economic updates from various websites and forex providers, analysing the economic landscape of particular regions and predicting how the market will move.
As mentioned above, one of the main dangers to any forex trader is the risk of big losses due to the leverage available. A clear risk management plan is essential, this can include things like stop-loss orders which provide a safety net to limit the losses a trader can make.
Because of the low barrier to entry, many traders are self-taught, and a lack of training can be their undoing. It’s advisable to trade on a demo forex account for several months before risking real money on the market.