Forex market has several reasons why a choice for traders or investors around the world to trade in Forex (Foreign Exchange). Some reasons include:
Liquidity
Liquidity is a term used to describe qualitatively how easy to make a good deal for the out (exit) and entry (entry). Trading was essentially involves two transactions that followed the opening position with the closure of positions. Liquidity is correlated with the volume to allow for easier transactions both in and out. Currency Spot Trading is one example of the market with the largest transaction volume in the world that allows this to market the most liquid market for trading.
With the forex trading volume is 50 times larger than the New York Stock Exchange, then there is always a broker or dealers who want to buy or sell currencies in the forex market, which increases the liquidity of this market, especially its main currency.
Forex Market Information Transparency
The development of increasingly rapid technological moment in allowing each person getting an opportunity and equal opportunity at the time of the transaction running at the Foreign Exchange Market. News can be updated any time with ease.
Forex Commission costs are low compared to stocks and futures
High commission costs which will affect potential losses and profits. Trading forex (foreign exchange) for a broker or commission house there is no discount commissions. This is because forex does not have a centralized exchange like NYSE or the CBOT therefore customers do not have to pay a particular fee amount.
Forex market is a perfect market for the Technical Analysis
Forex market is a perfect market for technical analysis. Long-term movement is generally associated with economic market cycle. Economic cycles always have a tendency to repeat.Therefore, a trader or investor can predict with good data. Repetition is the key to technical analysis. Unlike the stock market, news from a certain company can change dramatically in a short time.
Because forex trading is a trade involving a country's economic conditions, the movement of foreign exchange is more stable compared with the movement of stocks or stock index.
Leverage / leverage Forex
The key to determining the value of investments in financial markets is the ability to bring large profits with very little capital. This is known as leverage. Viewed from perdangan futures (futures), the meaning of leverage is a situation where a placement of a small number of funds which may be obtained profits or losses as a result of price changes that occur, the amount calculated from the value of funds placed. Someone had to be careful in using it as leverage levels or can be a double-edged sword, on one hand can be very profitable, but on the other hand is very risky.
Ease trade
Market Forex trading market is 24 hours, 5 days a week starting from Monday to Friday. Market Forex (Foreign Exchange) offers a potential for larger profits than the Capital Market (Stock Market) by the time you can customize.
There are some good time to conduct forex transactions because it usually has a sharp movement for example:
- Opening and closing of each session
- Opening session of European Market
- Opening and closing the New York Market
