This article looks at the reasons why you should consider trading on the foreign currency exchange.
When you look at the different markets that you can trade on you should consider the reasons why you should look at the forex currency exchange. There are a number of reasons why the foreign currency exchange should be the market that you trade on.
The Trading Style
When you trade on the foreign currency exchange you can choose from a range of different trading styles. There will be a trading style that suits what you want to achieve and your personality. The strategies that you can use are also highly diverse. The strategies will employ different analysis methods and you can choose the ones that you are most comfortable with.
If you are more comfortable with the analysis of the forex news then you will be able to find strategies that use this. You can also find strategies that use technical analysis for trading.
The Amount of Information
When you look at any trading market you have to consider the information that you can get to trade with. There are many markets where the retail trader is at a disadvantage when it comes to the information you need and can get. This is not the case with the forex market as all the information is released at the same time to everyone. The information that you need is also free to obtain.
The Capital to Trade on the Foreign Currency Exchange
When you trade on the foreign currency exchange you will need to have less capital than with other markets. The accounts and lot sizes that you can use can be customised to suit the capital that you have. If you have limited amounts of capital then you are able to trade on the forex market with the smaller accounts and lot sizes.
Of course, you will want to work up to trading with the larger lots. However, this is not something that you have to do at the start of your trading career. If you do not have the capital to trade with these accounts then you do not have to worry.
The Customisable Leverage
Leverage is one of the primary reasons why many people look at trading on the forex market. The leverage that you are able to get on this market is much higher than the leverage on other markets. You are also able to customise the amount of leverage that you use on each trade. This allows you to keep to the risk limits and capacity that you have for your trading.
Can’t Lose More Capital Than You Have
With trading on other markets there is the chance of losing capital that you have not put into your trading account. This is not something that you will experience on the forex market. When you make a loss on the forex market you can only stand to lose the amount in your trading account. This is due to the automatic margin calls that come when you are close to depleting your trading account. At this point your broker will close your trades and tell you that you are running out of capital in your trading account.
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