My-Invest Forex Trading Company - Why Is Forex Trading So Attractive and Yet So Devastating for Many Investors

My-Invest Forex Trading Company Investment in today's money market world is roughly divided into futures and commodities, various funds and stocks

. The most classic and long lasting of these are stocks. Despite the old, reliable and trustworthy means of making money in the stock market the new fierce money making machine has emerged not long ago (around 70's, I guess) called forex. Forex is described as financial market for currencies trading. In other words, you sell or buy one nations money against the other nation's money. The main and the only asset that is bought or sold is currency, not stocks, gold or oil, or other kind of commodities. The main thing here sold or bought is currency pair. If, for instance EUR is sold, it is always sold in relation to another currency which is then bought respectively. If I am selling 10000 EUR/USD currency units at a price of 1.36, it means that I am selling 10000 euros and buying 13600 US dollars for euros, at a price of 1.36 dollar for 1 euro. If I expect the dollar currency to rise against the euro - that's what I would do. Conversely, if the euro is going to rise, I will sell some amount of dollars and buy euros (which are thought to become more expensive in the future). It does not matter if a currency is falling or climbing up - it is always in relation to another currency which does the opposite. So what are the things that make forex trading so popular? 1. No matter where does the currency go - you can always make some profit. Gone are the days, when the bottom making meant some money loss - no you just have to enter the market at the right price and right moment and buy or sell the right currency. My-Invest Forex Trading Company 2. Leverage. This is very powerful and dangerous at the same time instrument for traders - especially inexperienced ones. Leverage means that by investing some amount of money in the forex market you are given by a forex broker a possibility to trade with much more currency units that you actually have. To put it shortly, if I have in my forex trading account 100 dollars I will be given an opportunity to operate with 1000, 10000 or even 100000 dollars. The proportion of my actual capital and the brokers' credited money might be 1/100 or even 1/200. The big leverage means that even the slightest currency change brings huge profits or money loss. 3. 24 hour trading. You can trade day and night, if you wish - the forex market never sleeps, and that's one of the attractive things for those wishing to make riches in this kind of investment. The only time it closes, is during the weekends and on national holidays. Those are the main reasons which make it advantageous against other kind of business. However, there are also some drawbacks here. First, according to the statistics only 5% of all forex traders produce constant profits. Another 50% do not earn anything and the rest are loosing their money. Why is it so? Well, because it is very volatile and stressful market, which is very unpredictable. The currency pair could mince slowly in a narrow price range for weeks and could also shoot for 500 pips in both directions in a matter of minutes. Only experienced, cold nerved and sticking to strict money management traders are able to earn some money, though very often they have to lick their wounds. If you still want to trade in forex, you might start from forex demo account and gain some knowledge about forex trading strategies, forex indicators, money management and the like. In the long run you will be able to trade profitably - just stick to what you have learned and don't play big. Remember - profit comes in small steps. My-Invest Forex Trading Company

My-Invest Forex Trading Company - Why Is Forex Trading So Attractive and Yet So Devastating for Many Investors

By: Forex Expert

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