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Sunday, June 29, 2008

The 7 Ways that Forex Trading

Currency trading and the Forex market continue to grow daily in popularity compared to the commodities, futures, and the stock markets. And its no wonder since the Forex market outperforms the others with consistent regularity. But do you know the ways that the Forex market accomplishes this? The following is a list of the seven ways that Forex trading outperforms the commodities, futures, and stock markets.
1) You are able to trade currencies anytime you want, day or night - Forex trading can be conducted 24 hours a day based on the opening and closing schedule of the different markets. With the exception of weekends, you can trade currencies around the clock if thats what you choose to do. The other markets cant do this since they abide by standard business hours.
2) Forex trading commissions are minimal compared to the other markets brokers - if that broker from the NYSE is gobbling up commission fees like Thanksgiving dinner at your expense, you wont have to worry about that happening with a Forex broker.
3) No delays between the time you place an order and the time it gets filled - the Forex market works in what is referred to as real time so there are never any delays between when the order is placed to when it is fulfilled. Delays are the norm with the NYSE and the other markets. And this can cost you thousands of dollars.
4) Trade directly with no middleman - trades in the Forex market never involve a middleman so you can make your trades directly with the entity that gives you the price. In the long run, you save money since there are no middleman fees to be concerned with. Costs are higher and progress slows down in the other markets because of the middleman factor.
5) No one person or company influences the direction of the Forex market - there are no experts that tell you via national television or some other media what you should be buying and selling. When this happens, the investor is rarely the winner. Usually the company that the expert is employed by is the real winner. This is never the case in the Forex market.
6) Less to think about, therefore less confusion - the Forex market deals in the four primary currencies and the 34 secondary ones. Compare that to the nearly 8,000 products that are offered by the NASDAQ and the NYSE. Is that a migraine that youre starting to feel?
7) Forex trading redefines the meaning of the word risk - Forex trading involves less risk. The money that you have in your trading account is all you can lose, since that is treated like a deposit against a larger transaction. If the margin amount that is required exceeds the capital in your trading account, your trading platform should automatically issue a margin call so you dont lose significantly. This is a good reason to know how to utilize stop loss and profit call orders. They are safeguards that you receive in time, unlike in the other markets.

By: Ben Needles
http://www.everyonesarticles.com

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