Advantages and Benefits of Forex Trading
There are numerous advantages and benefits of trading in the Forex market. Here are just some reasons why so many people love to trade Forex market:
No exchange fees, no clearing fees, no brokerage fees, or even no government fees. Most retail brokers are compensated for their services all the way through something called the “bid-ask spread“.
Forex trading eliminates the middlemen and enables traders to trade straight with the market responsible for the pricing on a certain currency pair.
No fixed lot size:
In the futures markets, contract or lot sizes are fixed by the exchanges. A standard-size lot for silver futures is 5,000 ounces. However, in the spot Forex, you decide your own lot, or position size. This facilitates traders to join with accounts as low as $25.
Low transaction costs:
In Forex trading, the retail transaction cost (the bid/ask spread) is usually less than 0.1% on regular market conditions. At larger brokers, the spread could be as little as 0.07%. Obviously this depends on your leverage too.
A 24-hour market:
From the Monday morning opening in Australia to the Friday afternoon close in New York, the Forex market never sleeps. This is a great opportunity for all especially for those who love to trade on a part-time basis, because you can decide when you want to trade or not to trade.
No one can manipulate the market:
The Forex market is so big and has so many participants that no single entity can influence the market price for a certain period of time, not even a central bank or the great Chuck Norris himself.
In Forex trading, a minimum deposit can manage a much larger total lot value. Leverage gives the trader the opportunity to make good profits, and at the same time maintain risk capital to a minimum.