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Profit in an up or down market
Unlike the equity market, with forex there are no restrictions on short selling. Profit potential exists in the currency market regardless of whether a trader is long or short, or which way the market is moving. Since currency trading always involves buying one currency and selling another, there is no structural bias to the market. This means a trader has an equal potential to profit in a rising or falling market.
Pay zero commissions or exchange fees
Capital Trader charges no commission or exchange fees to trade forex online or on the phone. In the equity markets, you must pay both a commission and exchange fees. The over-the-counter structure of the forex market eliminates exchange and clearing fees, which in turn lowers transaction costs. Costs are further reduced by the efficiencies created by a purely electronic marketplace that allows clients to deal directly with the market maker, eliminating both ticket costs and middlemen. Because the currency market offers round-the-clock liquidity, you receive tight, competitive spreads both intra-day and night. Stock traders can be more vulnerable to liquidity risk and typically receive wider trading spreads, especially during after-hours trading.
Up to 50 times the leverage of trading stocks
Forex offers a number of advantages over other types of trading, including:
Trading forex with Capital Trader gives you up to 50 times the leverage of trading stocks. In stocks, for every $1,000 cash you invest, you control a maximum of $2,000 worth of stocks. The maximum leverage is 2:1. But with forex, if you invest $1,000 margin on a foreign currency trade, you can control up to $100,000 in currencies.
Trade mini contracts for as little as $2,000
Many brokerages do not allow you to invest in odd lots, but only in blocks of 100 shares at a time. With many stocks valued at between $30 and $200, that can mean an investment of $3,000 to $20,000 – or more. But with Capital Trader, you can invest in foreign currencies for as little as a $2,000 deposit with mini contracts. The smaller trade size enables you to take smaller risks. The Mini Contact is intended to introduce you to the excitement of currency trading while minimizing your risk. You can try out the demo account and “paper trade” or you can open up a mini account right now and trade for real.
If you like technical trading, forex is perfect for you
The strong trends that foreign currencies develop is a significant advantage for technical traders. Unlike stocks, currencies rarely spend much time in tight trading ranges and have the tendency to develop strong trends. Over 80% of volume is speculative in nature and, as a result, the market frequently overshoots and then corrects itself. A technically trained trader can easily identify new trends and breakouts, which provide multiple opportunities to enter and exit positions.
Analyzing countries is easier than companies
Countries are often more stable than companies – and it's easier to predict their overall economic direction. Currencies are traded in pairs, so if a trader “buys” one currency, he is simultaneously “selling” the other. As with a stock investment, it is better to invest in the currency of a country that is growing faster and is in a better economic condition. Currency prices reflect the balance of supply and demand for currencies. Two primary factors affecting supply and demand are interest rates and the overall strength of the economy. Economic indicators such as GDP, foreign investment, and the trade balance reflect the general health of an economy and are therefore responsible for the underlying shifts in supply and demand for that currency. There is a tremendous amount of data released at regular intervals, some of which is more important than others. Data related to interest rates and international trade should be most-closely examined.
Trade 24 hours a day
CAfter-hours stock trading is not a very liquid or easy market to trade. But with forex, you can trade 24 hours a day – in the largest, most liquid market in the world.
Why not give it a try? It takes just a few minutes to download our FREE Capital Trader Trading Station. |