Why Should You Prefer Online Forex Trading and Not Other Types of Investment? of Forex Trading Money




Forex Trading is only one over various options in investment. Any investment has its own risk and advantage, you need to know the profile and find the best suitable investment for you. This article will discuss briefly the various investment available including trading forex oline.

Trading forex online is the choice of investment if you want higher return compared to the return from conventional investment. Make sure that you understand that the word ‘conventional’ in bank deposit and certificate of deposit means that you will have very low risk or even almost no risk in losing your money.

As the opposite, the non conventional investment such as forex trading could make you loss your money either in insignificant amount or the other way. This is the first note of choosing type of investment.

How to response to the risk of trading forex online? A traditional strategy would be differentiation of your investment. You should not put all your money in forex trading. A good portfolio of investment should consist of safe investment as the cushion in an investment shock and a high return investment for growth.

The percentage of each type of return depends on your willingness to accept the risk of losing your money. For example, if you are young, single and has no one under your responsibilities, you can take higher rate in order to enjoy the higher return. In the opposite, if you are retired already, you should put more cushion or safe investment rather than playing in high risk high return one.

Compared to other non conventional investment such as stock market and commodity market, investment by trading forex online has advantages. For example, forex is traded through computer network around the world not from specific place such as stock exchange. It means that there are floor traders that could ruin your profit by big transaction or flushing the market.

Trading forex online is done through forex broker, but the brokers take a small part of the gain compared to the bigger amount in commodity market. The forex market is very liquid unlike commodity market. Liquid market means that you can count on this investment for short term purpose. It is because you can sell your forex at anytime and get enough buyers to execute the selling. Obviously, this is the same advantage you can get from stock market but not in commodity market.

You can enjoy the advantage of market liquidity like investment in stock market, but you don’t have to worry about the complexity of the market. In stock market, you have to choose certain stock from a very long list of sold stock, while in forex market the liquid forex is limited to only four currencies.

Without ignoring the potential other non common currencies, most of the profit from forex market are made from US Dollar (USD), Japanese Yen (JPY), and Euro and British Pounds (GBP). Lesser choice means lesser headache, right?

In Summary, we could say that safe investment like bank saving and certificate of deposit has the advantage of low risk of investment. The non conventional investment should be taken as a combination investment to enjoy the growth. The high return investment mostly come in one package of high risk features.

Trading forex online sits together in this category with stock market investment and commodity trading. Each investment offers different features. The advantage of forex trading are the lesser option of currencies to trade compared to long list of stocks, the smaller com