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What is Forex and Why Trade it?

Euro, Bill, Currency, Ball, About, Sliding, Pawn, MoneySo What is and Why trade it, you ask?

The Forex market is one the most liquid markets in the world. With TRILLIONS being exchanged over the course of a day. Forex is the market where all the world’s currencies trade.  It is an over the counter trading exchange with no central exchange unlike the stock market. If you wanted you could (but we wouldn’t recommend) buy and sell currencies, 24 hours a day, five days a week in this market.

Forex is a commonly used abbreviation for “foreign exchange”, and it is typically used to describe trading in the foreign exchange market by investors and speculators.

That was broad textbook overview of what Forex is.

But why trade?

Well, there is no one right answer and there is no answer that suits everybody.

First, the opportunity to Build Wealth or at least supplement income (or once you are actually proficient and know what you are doing)

Also, unlike stocks you don’t need a lifetime savings worth of capital to get started. The beautiful thing is that you can get started with as little or as much as you would like. (For those getting started less is definitely more.) This is especially true when you factor in the leverage you might be using. (Complete Link)

Whereas, the stock market where if you are day trading good luck trying to get started with less than $25,000. In fact, no broker will let you trade with less than that amount and if you do prepare to have your account frozen.

Or if you are simply investing and not trading you still need a reasonable amount of cash to buy a decent amount of any stock. If the average share price for a stock is $25 you’re looking at having to put up a considerable amount of cash to invest. While subsequently, being forced to have to watch the capital be tied up for a as long as it takes to make a profit, if you make one.

Now, that’s not to say it’s easier to profit, it’s not. But the barrier to entry is much, much lower for someone looking to build get started in the markets.

Versus Forex, where even as little as $500 can help you get started. In fact that may even be a recommended amount as most new traders will generally blow through their first account. And we can all agree that burning through $500 trying to learn an invaluable skill as this is much less heartbreaking than looking up one day and realizing you have burn through $25,000 of your precious start up capital.

The best part is there are different styles of trading to suit your objectives, time and preference. The are traders who spend a majority of their time in the trenches of trading and in front of the screen. And on the opposite side of the spectrum, there are traders who have day jobs and place on a handful of traders per week. It is completely up to you.

At the end of the day if you are looking for alternative ways to invest your money and build wealth. This is a hell of a place to start.