The lack of commissions had worked
It's simple: no commissions had worked, payment for clearing and exchange fees, fees and government fees broker. In different places can use different types of fees, but in trading cash currency in the world of Forex no commissions had worked only mean one thing - NO fees.
8000 species of actions against four major currency pairs
Approximately 4.500 shares on the New York Stock Exchange. Another 3.500 are presented in NASDAQ. What you choose? What software you use? Does enough time? In the auction currency is at your disposal are 4 main markets, the ability to work 24 hours a day 5.5 days a week. Focus on Home - Find what you need. You have about 34 minor currencies to look at them at your leisure (if you like).
Dream day-trader - "bull market"
Due to limitations on short selling in the stock market, often for day-traders can be difficult to find profitable trades with a decrease in quotations on the market. Despite the fact that day-traders tried to circumvent these obstacles by using bullets, etc., the final costs are often onerous. Traders who sell ordinary shares in the end remain with missed opportunities, or very costly.
In contrast, the Forex market has no restrictions on short selling. As soon as the transaction on the Forex market is buying one currency and simultaneously selling another, so the market is "bullish" in any case. For example, if you are trading EUR / USD - you buy the base currency, which in this case is the EUR and pay for it in terms of reciprocal exchange by selling USD. Otherwise you sell the base currency, ie EUR USD.V buying both cases, the currency is bought, so on the Forex market is no negative connotation associated with short sales.
Leverage
One of the main advantages of Forex for currency traders are available to them to use "leverage". On the margin policy is 5%, the trader can use a credit of up to 200:1. That is, control the position of $ 100,000 using the only $ 50. However, do not forget the Otomi, the use of credit has advantages and disadvantages, so you should avoid using very large loans, as this can lead to large gains and big losses.
The absence of middlemen
Stock markets include many of centralized exchanges. One of the problems of any centralized exchange is the involvement of intermediaries, which entails additional costs prisovershenii any transaction. Payment can be time-based or in the form of royalties. In currency trading is possible to do without intermediaries, which allows the client to cooperate directly with the market. Forex traders have a quicker access and cheaper transaction costs.
Programs of purchase / sale does not control the market
How many times have you heard that "fund A" was selling "B" or to buy the "E"? There were rumors that the fund made a profit because of the financial year or because today "the day of the witches' as an explanation of why this stock is increasing in price or the market is inactive. That would not tell your broker, the stock market is very sensitive to large stock sales and purchases, and very difficult to fund a sin to use a security for a few days. In currency trading liquidity of the Forex market makes the probability for any fund or bank to control a sin currency is very low. Banks, hedge funds, governments, retail currency conversion pukto as well as private individuals are merely actors in the foreign exchange market, the liquidity is unprecedented way.
Analysts and brokerage firms have little effect on the market
We watched TV recently? Heard as an analyst prestigious brokerage firm accused of having given advice to buy shares while they are rapidly falling in price? This is the essence of such relationships. No matter what government is doing to prevent such activity, we do not know about it. Initial public offering of shares (IPO) - is big business, both for growing companies, as well as for brokerage firms. The relationship is very beneficial and analysts work for brokerage firms in need of companies as clients. This "paragraph 22" there will always be. Forex, the primary market, brings billions of dollars in revenue worldwide banks and international markets is much needed. Forex Market analysts do not affect the conduct of transactions, they only analyze the situation on the market
Trade with the countries with the potential
Stock traders rely on technical and fundamental data when the estimated potential growth of a company. To the same data are based when evaluating economic conditions and currency of the country. Determining the value of the currency is based on supply and demand. That is, such facts as the change in exchange rates, economic indicators such as GDP, foreign investment and trade balance together define the state of the economy and the underlying supply and demand for currency. As a simple example, consider the rating of interest in the Central Bank. If interest increases, it is expected that the capital invested in the country will increase and investors expect a high return on invested capital in this country, but not in others. The more capital invested in the country, the greater the demand for its currency, which primarily affects the growth of its value.
Forex or stocks
Advantages over the stock market
Trades are conducted 24 hours a day
No matter what time in the world there are always buyers and sellers actively trading foreign currencies. Foreign exchange market is active 24 hours a day, 7 days a week, and traders have the opportunity to make money on world events that can and do affect the world's currencies. Foreign exchange market reacts to the latest news immediately, and yesterday's news does not affect the profit and loss. So you have a chance to take advantage of this and take part in international events.
Trading equities has some limitations. ECN's (Electronic Communication Networks), also known as "matching system", connects buyers and sellers when possible. The trap is that there is no guarantee that every transaction will be executed or done at an attractive price, and traders often have to wait for the market opening the next day to get a better spread.
Super-Liquidity
Foreign exchange market has a daily turnover of more than 50 times exceeding the turnover of the New York Stock Exchange and there are always brokers or dealers who buy or sell currency on Forex. Liquidity of the market (especially the major currencies), facilitates price stability. Traders can almost always open or close a position at an attractive price.
Because of lower trading volumes, investors on the Stock Exchange, is much more vulnerable to liquidity risk, which leads to wider spreads and larger price movements as a response to any relatively large transaction.
Credit 100:1
Credit 100:1, generally available to dealers online Forex, much greater than 2:1 margin loan is used by joint stock brokers. Traders with a loan of 100:1 can control the position at $ 100,000 with $ 1,000, that is, 1%.
Leverage available to firms trading currency online is a powerful, profitable tool, not an additional risk, as many misunderstand. Why use a loan advantageous to the foreign exchange market? Because the average percentage of the daily price movement the main currency - less than 1%, while on an exchange rate of the price movement may amount to 10% on any given day.
Is there any effective strategy? The most effective way to manage the risks associated with margin trading is to stick to a reasonable trading strategy. Should always use limit and stop orders. Ideally, you should develop and maintain a system that works for you, when your controls are activated and emotions prevail.
The potential profit if the market rises and falls
Each open position is long one currency and short another. What is short position? Short position - one in which a trader sells currency in the hope its price will fall. This means that there is potential for a rise or when lowering market.
Ability to sell currency without any restrictions - another key advantage over the stock trades. On U.S. stock markets are much more difficult to establish a short position due to the "rules of zero growth," which limits the short sale if the price of the previous sale had not been equal to or lower than the price of the short sale.
