Why Trade Forex ?
Foreign Exchange (Forex or FX) Market is the largest market in the world. The trade happening in the forex markets across the globe currently exceeds $1.9 trillion/day. This is more than one hundred times the daily trading on the New York Stock Exchange. The forex market is a seamless 24hour market (expect on weekends) and it`s extreme liquidity market.
A forex tradeing is the simultaneous buying of one currency and selling of another one, so traders can easily trade in a rising or falling market and make a profit. The currency pair used in the trade is called a cross (for example EUR/USD, USD/JPY, GBP/CHF).
The forex is traded without comissions that makes it very interesting for day traders as well as investors who want to deal on a frequent basis. Also free real-time quotes, news, charts, tools, and more is available.
The spread is the difference between the sell price and the buy price. Dealing spreads as low as 3-10 pips are available in forex trading (even lower for major trades). For example the bid/ask quote of EUR/USD might be 1.2550/1.2553. The difference is USD 0.0003, which is equal to 3 pips. The lowest spreads (USD 0.01) on stock trade are 30x wider.
Market makers offer trading ratios (leverage) from 1:1 to 200:1. With more buying power trader can increase total return on investment with less cash outlay. For example, 100:1 leverage a USD 1,000 deposit can command positions of up to USD 100,000 through leverage.
To learn more about forex trading click here.