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Monday, September 1, 2008

Uniqueness of Global Forex Market

Forex market differs very much from all other markets. It is the world’s largest financial market with transactions worth trillions of dollar per day and is also the most liquid market. There are also many other things which make the currency trading market unique, especially for retail traders.
  • Market is least regulated by retail traders. More than 95 percent of global currency transactions are done by central banks, big companies and hedge funds. They trade currencies with specific rules and principles and are not at all thinking like a retail trader.
  • Transparency – Local news less regulate market movements. It is the macroeconomic news that regulates forex market, which are readily become available to all persons by worldwide media.
  • Least chance of scams – No single trader, or even a government, can play the fabricating game in this most liquid market.
  • More opportunity for retail traders – Retail scalpers looking for short-term profits can react to news faster than big banks and companies as it is pretty easy for them to take trading decisions and to open/close positions.
  • Trade both fundamentally and technically – Fundamental traders can profit from trading with long-time frames – days and weeks. Technical traders can profit from trading with shorter-time frames. Low margin requirements and less trading costs offer great flexibility.

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