Have you ever wondered about forex investing as a part-time or full-time pursuit? If so, it’s important to know the main benefits of this kind of trading. Millions of people buy and sell foreign currency to supplement their income. Others gain enough experience to turn the hobby into a profession.
Here’s why so many people take part in forex trading:
Low Entry Cost
Unlike many other kinds of trading, like stocks for example, forex has a very low entry cost. You can set up an account with super-low minimums, trade in very small dollar increments, and pay small commissions.
Begin trading foreign currency for under $50
Some of the large online brokers advertise specials in which you can get free commissions for a certain amount of time. In fact, it’s entirely possible to get all set up and begin trading foreign currency for under $50.
Risk Can Be Limited
You can limit both long and short risks in forex but setting stops on every order you place. That means, whether you go long or short, a stop order can get you out of a potentially hazardous trade at the exact point you indicate.
Trade Any Time
One thing that attracts many working adults to forex is the fact that you can trade around the clock. Let’s face it, if you have a day job, it’s virtually impossible to trade stocks because the markets open late in the morning and close in the early afternoon. But with forex, you can trade around the clock from Monday through Friday.
Sell Short, No Problem
For stock traders, selling short means the need to have an approved margin account. Not so in the world of forex. All you do is place a sell rather than a buy order, carefully place a stop on the order, and wait for the price to fall. For forex traders, shorting is as easy as going long.