Foreign exchange trading is more than just trading currencies when you travel to other countries. It is also a very lucrative form of investment trading. In fact, it is the largest financial market in the world.
The top currencies being traded are the US dollar, yen, and euro while the Australian dollar, British pound, Swiss franc, Canadian dollar, and Swedish krona come in a close second in popularity.
What Are the Advantages of Trading Forex?
The forex market is open 24 hours a day so you don’t need to keep on rushing and being conscious about time, fearing the market will close before you can even start trading. With forex trading, you get to trade anytime of the day.
You also need not worry that there will be a monopoly in the forex market. The market is huge has many participants, making it hard to control.
Furthermore, forex trading, especially in Singapore, is a liquid market. You can buy and sell anytime because there is always someone who will take your other side of the trade. Additionally, traders get leverage, which allows them to make good profit while keeping their risk capital to a minimum.
Dangers of Forex Trading
A forex trading leverage can either make or break you. It has helped many traders gain a nice profit but the fact that you are using more money than what is actually on your account makes it risky. Leverage can easily increase your profit but it can also increase your risk for losses. The best way to avoid the leverage trap is to never jump into anything you do not fully understand.
To truly get the full benefits of forex trading, practice and hone your trading skills with free demo accounts and ‘play money’ until you are ready to open a live trading account.