Most people would perceive foreign exchange (also known as Forex or FX) trading as a means to convert one currency into another. Hence, people primarily associate it with tourism, exports, and imports.
However, some insightful people understand the potential to learn Forex trading to earn money or increase your capital. After all, the value of currencies constantly fluctuates. Thus, some increase whilst some decrease, and several currencies (28) are available for foreign exchange.
However, people mistake it to be identical to Stock Exchange practices. While it does follow an ‘investment, risk and returns’ structure, it is an entirely different concept. Correlatively, it is one of the fastest-growing markets with a daily business of approx. £4-6 trillion daily.
Therefore, if you’re looking for a way to learn Forex trading, it might be one of the most lucrative options available. You may be asking, “Why should I start forex trading?”, “How can I excel in the area?”; Let’s have a quick look at the factors and help you learn Forex:
1. The leverage factor
A primary factor when looking into foreign exchange trading is leverage. There are countless brokerage firms available for Forex trading. They all offer you an option to gain leverage. Leverage is the amount of ‘extra’ money you can take over your pre-existing amount. For example, brokerage firms are willing to provide you 50 to 2500 times the money of your account value.
In other words, if you have £100 in your account, you can get £50,000 on 500:1 trade in foreign exchange markets. This primarily makes it the best option for people stuck in 9 to 5 jobs or other profiles and want to change their lives.
In other words, Forex trading is available for anyone.
2. Low monetary requirements
Even if you decide not to take benefits of leverage, Forex trading doesn’t have any cap on the amount you can invest. You can invest as little as $50 or even millions of pounds into forex trading. So, if you seek to increase your capital gradually, you can achieve that as well. Once again, this makes forex trading a compelling choice for anyone, and especially beginner traders.
Correlatively, it is also easier to start trading Forex. All you need is a credible platform, a trading application, and a bank account to start trading. However, if you don’t want to face the same risks that a gambler does, it would be the right choice to receive the proper education for FX trading.
You can even get a free account with virtual money to practice and learn how the market works, making it great for beginners.
3. A beginner-friendly choice
As mentioned, you can get a free practice account with virtual money to trade. You can use this money to understand foreign exchange trading before deciding to use real money. It is also reasonably easy to understand how the market works and how you can trade, but only if you find a credible platform to educate you. As long as you find a professional course for forex trading, you will get comprehensive knowledge of terminologies.
If you choose the right learning platform, it will take you less time to get accustomed to the world of Forex Trading. Furthermore, if you receive expert advice, the market will become easier for you to understand and trade. Thus, over time, with the proper education, you will thrive.
Technical trading may seem like an intimidating term, but it is quite simple. It’s simply just reading the price charts, and when you receive the best training from us, you will be able to read these charts easily.
As well as technical trading, there is also fundamental trading. Fundamental trading is the process of breaking down the impact of political, social and economic factors that may influence the value of a particular currency.
4. High volatility but low-risk platform
Of course, anything with high returns will have increased risk, and the same applies to forex trading. Correlatively, this volatility can also mean a more increased risk of losing money. However, when you conduct Forex trading, you trade the currency as a pair.
You can decide to go long (buy) or short (sell) the currency at any time. The market is also open 24/5. The accumulation of these aspects may turn FX trading into a lucrative option for you.
5. A one-man trade
You can indeed hire financial advisors, fund managers, relationship managers, or rely on the brokerage firm to assist you in trading. However, Foreign exchange trading is primarily a one-person trade that will depend on your experience and education. Therefore, if you don’t like to rely on too many people and won’t want to pay excessive fees like transactional charges, service charges, and much more, it is an excellent alternative for you. In addition, as you reduce the cost of trading, it will directly increase your profits, which is a fantastic plus point.