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Pros and Challenges of Trading Forex
forex_trader_1786937
Mitglied seit Aug 23, 2020
142 Posts
Sep 25, 2020 at 01:58
Mitglied seit Aug 23, 2020
142 Posts
I found this below very useful, and newbies should always know about it
12 years ago I was a newbie too, but now a profitable proffesional. So always know what you are getting into.
Pro : The forex markets are the largest in terms of daily trading volume in the world and therefore offer the most liquidity . [2] This makes it easy to enter and exit a position in any of the major currencies within a fraction of a second for a small spread in most market conditions.
Challenge: Banks, brokers, and dealers in the forex markets allow a high amount of leverage , which means that traders can control large positions with relatively little money of their own. Leverage in the range of 100:1 is a high ratio but not uncommon in forex. A trader must understand the use of leverage and the risks that leverage introduces in an account. Extreme amounts of leverage have led to many dealers becoming insolvent unexpectedly.
Pro : The forex market is traded 24 hours a day, five days a week—starting each day in Australia and ending in New York. The major centers are Sydney, Hong Kong, Singapore, Tokyo, Frankfurt, Paris, London, and New York.
Challenge: Trading currencies productively requires an understanding of economic
fundamentals and indicators. A currency trader needs to have a big-picture understanding of the economies of the various countries and their inter-connectedness to grasp the fundamentals that drive currency values.
The Bottom Line
For traders —especially those with limited funds—day trading or swing trading in small amounts is easier in the forex market than other markets. For those with longer-term horizons and larger funds, long-term fundamentals-based trading or a carry trade can be profitable. A focus on understanding the macroeconomic fundamentals driving currency values and experience with technical analysis may help new forex traders to become more profitable.
12 years ago I was a newbie too, but now a profitable proffesional. So always know what you are getting into.
Pro : The forex markets are the largest in terms of daily trading volume in the world and therefore offer the most liquidity . [2] This makes it easy to enter and exit a position in any of the major currencies within a fraction of a second for a small spread in most market conditions.
Challenge: Banks, brokers, and dealers in the forex markets allow a high amount of leverage , which means that traders can control large positions with relatively little money of their own. Leverage in the range of 100:1 is a high ratio but not uncommon in forex. A trader must understand the use of leverage and the risks that leverage introduces in an account. Extreme amounts of leverage have led to many dealers becoming insolvent unexpectedly.
Pro : The forex market is traded 24 hours a day, five days a week—starting each day in Australia and ending in New York. The major centers are Sydney, Hong Kong, Singapore, Tokyo, Frankfurt, Paris, London, and New York.
Challenge: Trading currencies productively requires an understanding of economic
fundamentals and indicators. A currency trader needs to have a big-picture understanding of the economies of the various countries and their inter-connectedness to grasp the fundamentals that drive currency values.
The Bottom Line
For traders —especially those with limited funds—day trading or swing trading in small amounts is easier in the forex market than other markets. For those with longer-term horizons and larger funds, long-term fundamentals-based trading or a carry trade can be profitable. A focus on understanding the macroeconomic fundamentals driving currency values and experience with technical analysis may help new forex traders to become more profitable.
forex_trader_1786937
Mitglied seit Aug 23, 2020
142 Posts
Sep 25, 2020 at 07:55
Mitglied seit Sep 24, 2020
17 Posts
Dorigda posted:
Trading is really quite risky, but there are not much more advantages, you just need to approach everything competently and judiciously.
It's true you have to have a sober mind in trading. and for me forex has a lot of advantags. first of all i knew a lot of new thing. Now i know every economics event. and even politics is interesting for me now. and the bigest advantags is money. i have aditional money from trading.
Sep 25, 2020 at 08:43
Mitglied seit Jul 19, 2020
298 Posts
Whatever trading style you follow you have to expert in that. If you do not have enough skills, you will not be able to stay here for long. A newbie should focus on learning and researching. They should remember it takes time to be expert.
forex_trader_1786937
Mitglied seit Aug 23, 2020
142 Posts
Sep 25, 2020 at 08:50
Mitglied seit Aug 23, 2020
142 Posts
Michihito posted:On point
Whatever trading style you follow you have to expert in that. If you do not have enough skills, you will not be able to stay here for long. A newbie should focus on learning and researching. They should remember it takes time to be expert.
Sep 26, 2020 at 11:50
Mitglied seit Jul 19, 2020
751 Posts
Yes forex market is the biggest financial market on earth. But only 5% to 10% people are successful in trading. It because it requires specific knowledge and skills to make profit. So every newbie should remember that they need to focus on sharpen their skills.
forex_trader_1786937
Mitglied seit Aug 23, 2020
142 Posts
Sep 28, 2020 at 06:37
Mitglied seit Aug 23, 2020
142 Posts
UweMoench posted:True, took me over a year to develop strategy now I'm using back in 2008. Since then no going back till date. I always avoid contracts of some banks becauseonce they see you are successful, the will try to tire you down with contract.I prefer private banks and individual trading as I have freedom.
Yes forex market is the biggest financial market on earth. But only 5% to 10% people are successful in trading. It because it requires specific knowledge and skills to make profit. So every newbie should remember that they need to focus on sharpen their skills.
Sep 28, 2020 at 08:57
Mitglied seit Feb 07, 2020
41 Posts
Pros Of trading
1.Low Costs
Forex trading can have very low costs (brokerage and commissions). There are no commissions in a real sense–most forex brokers make profits from the spreads between forex currencies.
2. High Liquidity
Compared with any other financial markets, the forex market has the largest number of market participants.
3. No Central Exchange or Regulator
Being an over-the-counter market operating across the globe, there is no central exchange or regulator for the forex market.
4. Low Capital Requirements
Due to tight spreads in terms of pips, one can easily start forex trading with a small amount of initial capital.
Challenges in trading
1. Lack of Transparency
Due to the deregulated nature of the forex market dominated by brokers, one actually trades against professionals.
2. High Risk, High Leverage
Forex trading is available on high leverage, meaning one can get profit/loss exposure multiple times of the trading capital.
3. High Volatility
With no control over macroeconomic and geopolitical developments, one can easily suffer huge losses in the highly volatile forex market.
1.Low Costs
Forex trading can have very low costs (brokerage and commissions). There are no commissions in a real sense–most forex brokers make profits from the spreads between forex currencies.
2. High Liquidity
Compared with any other financial markets, the forex market has the largest number of market participants.
3. No Central Exchange or Regulator
Being an over-the-counter market operating across the globe, there is no central exchange or regulator for the forex market.
4. Low Capital Requirements
Due to tight spreads in terms of pips, one can easily start forex trading with a small amount of initial capital.
Challenges in trading
1. Lack of Transparency
Due to the deregulated nature of the forex market dominated by brokers, one actually trades against professionals.
2. High Risk, High Leverage
Forex trading is available on high leverage, meaning one can get profit/loss exposure multiple times of the trading capital.
3. High Volatility
With no control over macroeconomic and geopolitical developments, one can easily suffer huge losses in the highly volatile forex market.
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Nov 20, 2020 at 16:49
Mitglied seit Jul 23, 2020
869 Posts
EllisParker posted:That’s true. I also agree. But traders need to know about both. It helps to grow as a trader.
There are pros and cons in each field. We got to see whether the pros are really benefitting for an individual and worth taking the risks for. In case of forex, the pros outweigh the cons for me.
Mitglied seit Jul 20, 2020
341 Posts
Mitglied seit Oct 07, 2020
104 Posts
Nov 21, 2020 at 04:32
Mitglied seit Oct 07, 2020
104 Posts
posted:Trading is really quite risky, but there are not much more advantages, you just need to approach everything competently and judiciously.
I found this below very useful, and newbies should always know about it
12 years ago I was a newbie too, but now a profitable proffesional. So always know what you are getting into.
Pro : The forex markets are the largest in terms of daily trading volume in the world and therefore offer the most liquidity . [2] This makes it easy to enter and exit a position in any of the major currencies within a fraction of a second for a small spread in most market conditions.
Challenge: Banks, brokers, and dealers in the forex markets allow a high amount of leverage , which means that traders can control large positions with relatively little money of their own. Leverage in the range of 100:1 is a high ratio but not uncommon in forex. A trader must understand the use of leverage and the risks that leverage introduces in an account. Extreme amounts of leverage have led to many dealers becoming insolvent unexpectedly.
Pro : The forex market is traded 24 hours a day, five days a week—starting each day in Australia and ending in New York. The major centers are Sydney, Hong Kong, Singapore, Tokyo, Frankfurt, Paris, London, and New York.
Challenge: Trading currencies productively requires an understanding of economic
fundamentals and indicators. A currency trader needs to have a big-picture understanding of the economies of the various countries and their inter-connectedness to grasp the fundamentals that drive currency values.
The Bottom Line
For traders —especially those with limited funds—day trading or swing trading in small amounts is easier in the forex market than other markets. For those with longer-term horizons and larger funds, long-term fundamentals-based trading or a carry trade can be profitable. A focus on understanding the macroeconomic fundamentals driving currency values and experience with technical analysis may help new forex traders to become more profitable.
Mitglied seit Oct 07, 2020
104 Posts
Nov 23, 2020 at 05:36
Mitglied seit Oct 07, 2020
104 Posts
richardmarcus posted:true thatposted:Trading is really quite risky, but there are not much more advantages, you just need to approach everything competently and judiciously.
I found this below very useful, and newbies should always know about it
12 years ago I was a newbie too, but now a profitable proffesional. So always know what you are getting into.
Pro : The forex markets are the largest in terms of daily trading volume in the world and therefore offer the most liquidity . [2] This makes it easy to enter and exit a position in any of the major currencies within a fraction of a second for a small spread in most market conditions.
Challenge: Banks, brokers, and dealers in the forex markets allow a high amount of leverage , which means that traders can control large positions with relatively little money of their own. Leverage in the range of 100:1 is a high ratio but not uncommon in forex. A trader must understand the use of leverage and the risks that leverage introduces in an account. Extreme amounts of leverage have led to many dealers becoming insolvent unexpectedly.
Pro : The forex market is traded 24 hours a day, five days a week—starting each day in Australia and ending in New York. The major centers are Sydney, Hong Kong, Singapore, Tokyo, Frankfurt, Paris, London, and New York.
Challenge: Trading currencies productively requires an understanding of economic
fundamentals and indicators. A currency trader needs to have a big-picture understanding of the economies of the various countries and their inter-connectedness to grasp the fundamentals that drive currency values.
The Bottom Line
For traders —especially those with limited funds—day trading or swing trading in small amounts is easier in the forex market than other markets. For those with longer-term horizons and larger funds, long-term fundamentals-based trading or a carry trade can be profitable. A focus on understanding the macroeconomic fundamentals driving currency values and experience with technical analysis may help new forex traders to become more profitable.
Nov 23, 2020 at 11:10
Mitglied seit Apr 15, 2020
219 Posts
The Forex market is the biggest financial market on earth. It requires very specific knowledge and skills to make profit. It is advantageous as well as risky also. Forex trading can be started at a very low cost, low investment is required and higher returns are expected from trading, but a risk is als associated with it as you can’t control volatility in the market.
The more your practice, the more you learn.
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