We must have heard of the term forex and probably have questions right? Forex simply means foreign exchange. Therefore, the forex market is short for the foreign exchange market.
Right now, forex is the fastest growing market in the world due to its really high liquidity and easy access to the common man. It is the act of trading currency pairs. This means you trade one currency against another, hoping that the value of your intended currency would rise against the value of the other.
The currency expected to rise is called the base pair, while that which its value is expected to relatively depreciate against the base pair is called a quote pair.
The currency pairs appear in this manner, GBP/USD, where Great Britain Pounds (GBP) is the base pair, and United States Dollars (USD) is the quoted-pair. In the currency pairing, base pairs always come first, followed by the quoted-pair.
What is the Function of the Forex Market
The function of the forex market is to help investors determine where the strength of a currency is headed, as currencies are being exchanged around the world on a daily basis.
The forex market is around the clock, off the counter market, because every information is out in the open, unlike the stock market which can be greatly affected by insider’s information. Forex market is affected by economic stability, political stability, in fact, anything that affects an economy.
Now you see why the information is out in the open? The decisions to make a profit or a loss depends on your ability to trade. One important fact to note is this, forex has a daily turnover of five trillion dollars. This means that every day, there are five trillion dollars out there for smart investors to rip profit from.
It is a twenty-four-hour market for complete five days. It only shuts on Saturdays and Sundays. Really interesting right? Now I will further elaborate on the benefit of investing in forex trading.
#1 You Become Your Own Boss
To be a boss means you make the decisions or call the shots without any for fear of being punished by anyone. No one imposes their ideas on you forcefully, giving you no option to lay your opinion on the table. In other words, you can do as you like and the repercussions are nobody’s business but yours.
This is the avenue, investing in forex creates for us. It eliminates the tension of you always pondering on what your boss would think if he appreciates what you have done or quite frankly if today is the day you get fired.
You finally get your freedom with the added bonus of deciding how much income you make too. It’s a better and easier working life. You don’t channel your energy to build someone else’s dream and get paid peanut to do that.
In the forex market investment, you rack in a hundred percent of your profit made, as there is no one to split your profit with you. Talking about being a mega boss. All you just need is to get an Android phone or a laptop, download the proper brokers’ application, sign in with your proper details, and you are ready for business as a BOSS.
#2 Work From Anyplace of Your Convenience And Time
Have you ever wondered if it was possible to carry your office in your pockets because you had to be at a different place at that time? That is no longer an issue because forex trading makes it possible.
You could be working from your toilet while taking a huge dump, or trading with one hand while eating hot Ẹ̀bà with the other. This is like the perfect working structure most people dream of. You can take a year-long holiday and not even bother about attending to customers, or employees. All you need to do is have your gadget with you and you are good to go.
Talk of an easy stress-free life. No time limit is placed on you either. When they say time waits for no man, with forex, time waits for you. Your daily business starts whenever and wherever you choose and ends whenever or wherever you choose too. You can decide to work any day of the week too.
It’s your choice to do whatever you want with your time and at any place of your choice. No more permission from office, or the trouble of work not letting you spend time with friends and family. Now you can spend time with loved ones and still work. This is a greate Benefit Of Investing in forex
Think of it, you can take your loved one out for dinner, use five minutes to even trade in the bathroom, then come back with a smile to continue your dinner knowing you just made a profit within that time range. Forex works like a charm and puts time adjoined with convenience, in our pockets.
#3 Reduces Stress
Stress is common in our everyday struggle to make money. but the benefit of investing in forex trading would take this away.
The market woman conveys her numerous goods to her shop and haggles price with customers all day, the engineer wakes up early in the morning, goes to sight and spend hours under the sun supervising, the medical doctor is in the operating room trying to perform a successful heart transplant, even the billionaire is in his sky-high office with board members, trying to discuss ways his company outperforms the competition.
All these are going on daily, and a forex trader is probably still on his briefs and singlets, smoking cigarettes and selling off currencies. This is part of the perks that come with being a forex investor.
Talk about living a stress-free life. Well, if you take away the cigarette part and replace it with a glass of orange juice, the forex trader is bound to live longer than the other hustlers. Stress is detrimental to our health and makes one seem older than they already are. Forex trading gives us a way to alleviate this problem. You may also check on the Financial Management/Market
#4 Highly Lucrative
One of the advantages and benefits of investing in forex trading is its high liquidity rate. This means that there is always enough money to go around. Come to think about it, this market has a daily turn over of five trillion dollars as we said earlier.
This means if you know how to trade properly, you could make millions of dollars off the market, it’s just a matter of time, lots of patience and the right trade openings. Another good quality of the forex market is the fact that not much capital is needed to open an account with a broker. This is a huge benefit of investing in forex market
Most brokers like Avatrade and eToro, require a minimum of a hundred and two hundred dollars respectively, as the minimum amount required to open an account. So the common man can also participate in biting off this money apple if he is a good trade farmer.
#5 Bootstrap Budget
In case you have no idea what a bootstrap budget means in business, it means using little revenue to start up a venture that could generate profit in the future. The forex market provides us with the ability to bootstrap our investment.
You don’t need a lot of capital to invest, as we said in the write up above, you could start trading with capital as minimal as a hundred dollars. The good thing about using little capital is that you can always re-invest if you lose it all.
#6 No Crisis
Crisis does not affect the forex market in any way because currencies are always being traded, even if the economy of a country slips into a meltdown.
This is possible because you trade a currency pair against another. Therefore, your method of making a profit is to actually to predict the rise and fall of an economy. If the economy of your base pair is stable, and that of your quote pair slips into a meltdown, a situation like that just ended up earning you a whole load of profit.
It doesn’t matter if the economy witnessing the meltdown is yours, you just have to trade it right. This is an all-round benefit of investing in forex and a good advantage for one who knows the secrets to forex trading. Stock markets can crash and even close down as a result of a drastic economic meltdown, leading to a huge loss of cash for investors.
But, this meltdown could be the rise from grass to grace for a forex trader who knows the game well. You just need to monitor an economy’s currency properly and know when to get into a trade or get out of a trade.
#7 Retirement Choice
This is as plain as it is written. Those of us who are not owners of our own enterprise don’t get to choose an early retirement because we get paid a specific amount of income which is never enough to secure an early retirement plan.
These are good benefit of investing in the forex, as a trader, you could get this benefit, so long they are able to build an impressive profit level.
In fact, when you begin to choose when you work, the number of hours you feel like working and the ability to decide where you work at any time of your choice, you are already retired. This is the fate of a good forex trader.
Though forex trading has wonderful benefits and almost no downside, it doesn’t guarantee that you won’t make a loss. You could lose all your capital on your first day of trading if you are sentimental over the market and don’t know what you are doing.
Most investors will always tell you to follow the trend, going against the trend most times could result in a brutal loss. The most important advice to capture before trading is, do proper research, and have good in-depth knowledge about trading techniques before you trade. Most importantly, be patient with your rate of profit growth. Do this, and you will smile like a kid given a piece of candy.