Thursday, April 9, 2009

The strengths of Forex for investors

A very high liquidity, which allows to enter and exit at any time, regardless of the amount (in all cases to a few tens of millions of dollars it is no problem). Indeed, the Forex is the largest market in the world and there is a peak around 2000 billion dollars of transactions per day on the currency. For example this is 400 times the average daily volume of the Paris Stock Exchange and 30 times that of the largest stock market in the world, the NYSE (New York Stock Exchange).

24 hours a listing of 24 and five days a week almost permanent opening of this market allows investors to make transactions whenever they wish, in the evening after dinner before heading out to work, anything is possible. You can also respond instantly to any event. This is not possible with the stock markets which are closed at night.

The possibility to make highly speculative transactions with a lever that can go up to 400 times the amount of your cash. Thus, for a $ 1,000 deposit into an account, some brokers offer to invest up to $ 400 000 through this huge leverage effect. We already imagine the damage that can result if there is anything ...

Low values to monitor-Unlike the equity markets which have hundreds or thousands of titles, Forex offers only a few dozen different currencies including five or six major operators that monitor closely and realized that the majority of trade.

Transaction costs reduced- To trade on the Forex market, financial intermediaries generally do not charge commissions, they pay only on the range purchase / sale (the "spread" in the language of Shakespeare). On major currency pairs, the spread is the difference between the bid and sale price is between 2 and 3 base units (or "pips" in the jargon of traders). For example, a transaction in the euro / dollar is generally less than 0.02%! Ten times less than on the action!

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