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Some banks allocate as much as 20-30% of funds into FOREX making 40-60% of all their profits trading currencies. In the August 1994 issue of International Finance Magazine, Charles Sanford, Chairman of Bankers Trust, expressed his opinion that by the year 2020, banks will cease their loan transactional business, and focus on currency trading as their primary revenue source.

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Why Forex Trading? PDF Print E-mail

With more than $1.5 trillion USD being traded daily, the Forex market has managed to become the world's biggest financial market over the last three decades. With the large minimum deal sizes and rigid financial requirements, the Forex market, till recently, was not explored by the common trader or individual investor. But now the average investor can also engage in Forex trading. Some of the advantages of Forex trading are as follows:

24 hours trading
Forex gives its traders a 24 hour trading opportunity. Being a Forex trader, you can trade 24 hours a day from Sunday 5:00 pm (ET) to Friday 4:30 pm. This gives traders an opportunity to trade according to their convenience, going by their own schedule and also a chance to react instantly to any breaking news of the markets.

High levels of liquidity
Also, acting as a huge attraction is the high liquidity. With almost 90% of all the currency transactions consisting of 7 major currency pairs, helps these currencies display price stability, smooth trends, narrow spreads and high levels of liquidity. This liquidity mainly comes from the banks which offer cash flow to companies, investors and market players.

No commission
With “free of commission” trading, Forex trade lets you keep 100% of your trading profits. This makes Forex trading even more attractive as a business opportunity, especially for those who want to deal on a regular basis.

Steady trading prospects
The market is constantly moving and since Forex trading involves buying and selling of currencies, so traders can easily operate in a rising or falling market. This is because, there are always trading prospects, whether a currency is rising or deteriorating in relation to another currency. So there is always profit potential in the Forex market, whether it’s short or long.

Along with these major advantages, the Forex market also has some other merits such as, Forex trading gives its traders, an opportunity to bigger profits as returns on their invested money. Also, since the market is open 24 hours a day, 5.5 days a week, it gives the investors can make their deals anytime they want to.

 

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