The Forex is a place where two nations do all of their trade dealings and their currencies are exchanged as well. Assume that US is doing some sort of a business with say UK
The Forex market happens to be the largest and also the most liquid in the entire world. There are innumerable day traders who all have now focused on looking for profits in mainly the markets of stock and futures. It due to the very restrictive nature of the Forex trading services that are offered by the bank. There are many large banks that utilize the FX market perfectly so as to protect their businesses from the fluctuating trends of the exchange rate of the many different currencies. Now if we think it broadly as an investor what a trader from the FX field does is simultaneously simply exchanging one nation’s currency for another thus in every actual aspect, they are the ones who are trading through the means of many electronic trading services. Both the currency-pair as well as the price quoted to people is nothing but basically the exchange rate between the couple of nations.
As has been mentioned before, there are several fascinating benefits that one can reap through the proper utilization of the Forex. There are many advantages that one can enjoy during the trading spot by the Forex as opposed to all the trading stocks. Some of these fascinating benefits are given below:
Get direct access to direct market prices
This is one of the most attractive forex benefits. Indeed, when you trade forex at Finotec, you get direct access to the market's most competitive interbank spreads. The way it works is that our brokerage firm receives spreads (the difference between the bid and the ask price) from 18 of the world's largest banks. That way and thanks to its large number of clients and the large volume traded through the platform, Finotec offers very competitive spreads on the main currency pairs.
Leverage Trading: High Returns with Relatively Small Deposits
this means that even if traders deposit a small amount of money, they can actually trade with a much bigger contract value. Finotec offers a 200 to 1 leverage. If you make a $100 margin deposit, you can actually trade $20,000 worth of currencies. With a $1,000 margin deposit, you can buy or sell $200,000 worth of currencies. However, you must keep in mind that if leverage allows for substantial profits, it also can lead to equally significant loss. One of the chief forex benefits can thus become a major liability. It is due to this that you need to figure out your own risk management policy before you start trading.
High Liquidity
This highlights to the forex market's ability to quickly convert or liquidate deals through buying or selling and without causing a significant price movement. The high liquidity of the forex market is mainly due to the large volume of currencies traded around the world. That way, currencies are exchanged instantaneously, 24 hours a day and with minimum loss value, since the next trade is usually executed at the same price as the last one. In the forex market, there are always plenty of ready and willing buyers and sellers.
Open 24 hours a day
The forex market is open 'round the clock, 5 days a week, from Sunday 5 pm EST to Friday afternoon 4 pm EST. This is due to the fact that there is an overlap of different time zones and that there is no physical central exchange that opens and closes at a particular time. Forex works through a global electronic network of corporations, banks and individuals. When you hear that a certain rate closed at particular price, this refers to the price at market close in London
Trade with as Little as $200
This is one of the main forex benefits when it comes to Forex Trading. Most brokers nowadays give their clients the possibility to open accounts with only a few hundreds of dollars (this is not a lot, considering the exponential profits you can make on a few hundred dollars). With Finotec, you can open a Mini Account with as little as $200. You can also open a Standard Account with $10,000 or practice on a demo account for free!