Not so long ago it was difficult for the average Joe, me, to do any trading on any markets, including the American Stock Exchange. There was no such thing as a day trader back then. In fact the big companies that were there for traders would stub their nose at me and laugh when I said I had one hundred dollars I wanted to invest.
Yes, they would literally laugh at me. This was repeated everywhere across the United States and was the status quote for years. It was just impossible for your average middle class American to break into the stock market. There was of course investing through you're work and a 401k. This was still limited and not really trading at all.
This all changed as technology improved and online trading was approved. Slowly it became easier and easier for the everyday person to make a day trade from his or her arm chair. As more and more people began to trade online startup companies sprang up to cater to these "day traders" There are even clubs and small groups of people who have banded together to pool their money and be able to make larger trades and better investments.
This leads us to Forex; or foreign exchange market. This market exists to solely trade in the commodity of currency. Foreign countries buy and sell products and services to one another they are subject to a foreign currency trade, or the trading of one currency to another. We can now also trade and speculate on these foreign currency trades. We do this in a speculative way. Betting that the amount one currency holds today will drop tomorrow etc.
America's markets close every evening and do not open again until the next day; if it is not a weekend. This limits the amount of time we have to trade but also the actual physical number of trades we can do.
Forex on the other hand is a world market. It can be traded twenty four hours a day every day of the year. This gives one much more potential and it also offers much more stability.
Some of the advantages of the Foreign Exchange Market are:
· 24 hour trading
· Volume; 50 times larger than the New York exchange, there is always someone trading in Forex.
· Margins; 100 to 1 leakage is not uncommon.
· Lower Transaction cost: fees are much lower when trading in Forex. It should be noted that there can be a much larger investment necessary to trade in Forex.
· Have it both ways; the potential is there for you to make money in both a rising and a falling market.
This day trader is happy with his journey into the foray of trading on the Forex market. Wish me luck and happy trading.