Our AdvantagesThere are several advantages and disadvantages associated with Forex currency trading. The truth is, this is a market that very few people really understand. A major reason why foreign currency trading remains shrouded in mystery is because it receives very little attention on the evening news. When was the last time you ever heard anybody talking about the performance of a particular currency? It’s extremely rare. That said, there are a lot of reasons why you may want to seriously consider trading currencies
It's a 24-Hour Market
The Forex market is worldwide so trading is pretty much continuous as long as there's a market open somewhere in the world. Trading starts when the markets open in Australia on Sunday evening and ends after markets close in New York on Friday.
There's High Liquidity
Liquidity is the ability of an asset to be converted into cash quickly and without any price discount. In Forex, this means we can move large amounts of money into and out of foreign currency with minimal price movement.
Transaction Costs Are Low
The cost of a transaction is typically built into the price in Forex. It's called the spread. The spread is the difference between the buying and selling price.
You Can Use Leverage
Forex brokers allow traders to trade the market using leverage, which is the ability to trade more money on the market than what is actually in your account. If you were to trade at 50:1 leverage, you could trade $50 on the market for every $1 that was in your account. This means you could control a trade of $50,000 using only $1,000 of capital.
There's Profit Potential from Rising and Falling Prices
The Forex market has no restrictions for directional trading. This means that if you think a currency pair is going to increase in value, you can buy it or go long. Similarly, if you think it could decrease in value, you can sell it or go short.