The foreign exchange market (Forex) is the most liquid financial market in the world with traders expression including large banks, central banks, institutional investors, currency speculators, corporations, governments, other financial institutions and retail investors with the daily turnover continually growing and estimated to reach $10 trillion per day by 2020.
In the Forex market, unlike the stock market that trades the stocks of companies or the commodity market that trades commodities, actual currencies are traded. The goods of the foreign exchange market are national currencies of different countries of the world.
Between April 2007 and 2010, forex trading increased 20% (around the same time as the financial crisis) and has more than doubled since 2004 and the increase in the turnover is due to a number of factors which includes but not limited to:
· The growing importance of forex as an asset class;
· The increased trading activity of high-frequency traders;
· The emergence of retail investors;
· The increase in Internet access and increase in Internet speeds across the world.
One of the particular reasons for the rapid explosion of the forex market is the electronic trading through Internet based portals which has made it easy for retail traders to trade in the market. This easy access to the foreign exchange market has made it possible for the average trader (or investor) to trade forex. However, despite the fact that the forex market is such a big market with big potentials for profits, the huge forex market is like the dangerous sea where you can meet sharks and get eaten, loose your investments and go bankrupt. At the same time, you could bring in $1,000,000 from a $1,000 investment in 14 days. As good as that sounds, the statistics show clearly that 95% of traders record a loss in the market, 5% have profits and less than 1% actually make large fortunes. In the recent past, forex has been portrayed as something very easy but in truth; it is not. The high you record today, may turn into the start of the loss of a fortune starting the next morning and this market is such a place newcomers are prone to make the very same mistakes over and over, several times.
It is like the big open sea with lots of sharks and limitless opportunities for profit, but you should never for a minute forget the presence of the “monster” sharks waiting.
But now you can trade forex without the risk of losing your hard-earned money.