Most of the forex articles on this website are about the principles of successful trading. To succeed in forex trading, there are several things that need to be known. That is knowing about Forex comparison with other trading instruments.
The Forex market is the largest financial market in the world. With equality in excess of US $ 3 trillion in exchanges that occur every day. Where the volume of the stock market is only US $ 500 billion. The Forex market is bigger than the stock, bond and futures markets when all are combined.
A liquid market, that is a market that has a large trading volume. And also the large number of market participants, allows us to enter and exit the forex market very easily. Which also means that it is not easily manipulated by anyone, thus creating a certain level of play for everyone.
Because of its thin liquidity, the Forex market is very fluctuating. So as to provide a number of opportunities for large transactions to us. Fluctuating results in a large trend tend to provide the right strategies. In fact, after transacting stocks, options and futures in the past I believe in something. That is, fluctuations in the Forex market allow me to take advantage of strong trends with the highest accuracy!
Because of the strength of leveraging, Forex trading can be very profitable. With the right trading systems, and depends on your psychological condition. Then your trading capital and financial goals make it possible to generate a monthly income of US $ 1,000, US $ 5,000, or US $ 20,000. I know about Forex traders who make increases of up to US $ 40,000 a month! Based on stock trading only, which has no lever. There is no possibility for us to reach the same level of profit.
Leveration refers to the use of a small amount of money (margin) to transact at a much larger size position. For example, a 100 : 1 lever will make you use a margin of US $ 1,000 to give to a trade value of US $ 100,000. As with high levers, combined with strong market fluctuations, Forex becomes very profitable.
That levering is a double-edged sword and at the same time can be very risky is true. However, few people realize that this is true. That is only when a forex trader does not follow a trading plan that applies strict regulations. Of course to recognize trading signals, which are applied to strategic entry and exit points in each unit trade. This means that a good trading plan will ensure that there is a great lever of strength working for us, and not against us.
The statement “leveraging is risky” is entirely very frequent to standardize the view that the failure that occurs is the result of ignoring these things. The reason that few successful Forex traders are serious is because of this.