- Forex is open 24 hours a day, 5.5 days a week.
- Forex is the most liquid market in the world.
- Trade Currencies with up to 400:1 leverage on accounts of $10,000 or less. Without appropriate use of risk management, a high degree of leverage can lead to large losses as well as gains.
- No restrictions on short selling which allows you to enjoy trading opportunities during any market condition.
Why Forex?
The foreign exchange market is the world's largest financial market, but it wasn't always accessible to any typical trader. The Foreign Exchange market, also referred to as the "Forex" or "FX" market, turns over $3.2 trillion in currencies daily. This makes the Forex market easily the biggest financial market in the world. Forex trading attracts significant numbers of investors due to numerous advantages not found in other financial markets, with some of the major reasons to Forex listed below:
High Leverage Up To 400:1
With more buying power, you can increase your total return on investment with less cash outlay. Certainly, escalating leverage increases risk - it also increases reward. With $1,000 cash in a margin account that allows 400:1 leverage (0.25%), you can trade up to $400,000 in notional value.*
24-Hour Trading
Forex is traded in a real 24-hour market, open continuously from 5:00 PM ET on Sunday to 5:00 PM on Friday. Of course there are sessions where trading is more heavy and volatile, notably the London and New York sessions. However, if you can understand the fundamentals of Forex, you can earn money according to your schedule, and have the rest of the day for your other pursuits. And since there is no waiting for the opening bell, traders can almost always open or close a position at a fair price.
Huge Market
The total volume of the Forex market helps to facilitate price stability in most conditions. This volume also leads to trading with very high liquidity and low transaction costs. Certain organizations, entities or parties find it impossible to manipulate or control the market resulting in a fairer playing field for everyone.
Ease of Use
In the stock market, there are over 40,000 stocks to choose from. In Forex, almost 85% of all currency transactions involve the 7 major currency pairs. You can choose one or two currency pairs and focus your analysis. Forex trades with recognizable patterns and clearly defined technical applications, comparable to those found in stock trading.
Low Account Minimums
Traders can enter the Forex market at several levels. Full accounts allow trading of multiple lots of currencies at once. Mini-accounts get traders started for a few hundred dollars. Demo accounts facilitate Forex understanding without any risk.
Recession Proof
If you understand the fundamentals of Forex, you can earn money whether the economy is in a bear or bull market. As long as the prices of currencies are moving (which they always are) you can make money on that movement. So when the economy turns down, you can expect a surge of interest in Forex services such as trading.
Profit in Rising and Falling Markets
In some financial markets, there are limits to how you can sell short a position. In currencies, there are no such restrictions. It is just as easy to bet that a currency will go up as much as it goes down. This is because you are not just buying a single currency, but you are buying it with another currency. So whether you are putting dollars into euros, or euros into dollars, there is no difference to the market.
*FXwells asks that you consider the risks associated with increasing your leverage. A relatively small market movement will have a proportionately larger impact on the funds you have deposited or will have to deposit; this may work against you as well as for you. You may sustain a total loss of initial margin and you may be required to deposit additional funds to cover a short margin position. Flexible leverage is available for self-traded accounts only (does not apply to managed accounts).
