Forex Business: Advantages, Disadvantages and Strengths
Still new to the forex business or want to deepen your knowledge about trading. Then you can read and understand the simple review below carefully. Learning forex can't be done half-heartedly, you have to really understand step by step and the advantages and disadvantages of each broker that you will use later.
Actually, this forex business entered Indonesia in the early 2000s and grew rapidly until it boomed in 2010. Especially in 2014 now (when this article was written), the forex business has become a "trend" for business people, especially for online businesses. in Indonesia ranging from upper class, middle class businessmen to "amateur businessmen" like me.
The answer lies within each of us because anyone who reads this article must have a desire or intention, to know more and know more about forex.
Back to the subject, that every business has its advantages and disadvantages, as well as the forex business. The advantages of the forex business compared to other businesses are as follows:
1. The market is open 24 hours non-stop from Monday morning to early Saturday WIB
Many trading markets around the world but only have an operational time of 6 (six) to 8 (eight) hours.
Well, if in forex we can alias freely in choosing and setting trading hours as desired. If we are busy in the morning until noon, then we can trade forex in the afternoon/evening and vice versa.
2. The transaction costs are small, the capital required is small
The cost to be able to transact in forex is that we only pay for the spread, which is usually the advantage of the bank or broker.
And now there are many forex brokers who offer cent / micro accounts with a capital of $ 5 - $ 10 only we can trade forex business. So there is no need to spend big when we want to do business in forex.
3. 2(two) direction market offers profit
If in other businesses, for example buying and selling cars, if the price goes up we make a profit but when the price goes down we will lose.
Now in different forex, we can take advantage of rising prices or falling prices. The point is in forex trading we will buy before the price goes up and sell before the price goes down.
4. There is leverage/leverage
This means that with small money we are able to control large amounts of money. So with leverage, it will allow traders with small margin deposits to contract large amounts of transactions.
It is because of this leverage that the forex business is known as the "High Risk & High Reward" investment business, which means that traders have the opportunity to get multiple profits but the risk is high because they can directly spend all of our capital.
5. High Volatility and Liquidity
The daily range is between 100 - 150 pips and the total swing movement can reach more than 600 pips per day. Likewise with the value of forex investment transactions that occur, now it has reached $ 4 trillion (four trillion USD) per day. So on a scale, the forex market can be said to be the largest of the other trading markets.
How ? Are you getting interested in the forex business? The answer comes back to each of us. Continues with forex shortfalls with other businesses as follows:
In forex we need trading skills, namely we must be able to analyze price movements, not just buy/sell. Trading skills are obtained through a process, so it requires careful learning and understanding. Without our trading skills, we will definitely fail in forex.
Okay, we have discussed everything according to the title, namely the Advantages and Disadvantages of Forex Business. Hopefully this article can be useful, thank you and good luck to all.