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The foreign exchange market is also the largest and most liquid market in the world, making it a real platform for fair market competition and real price withdrawal.
The foreign exchange market is open 24 hours a day, 5 days a week. Trading begins when the world’s major financial centers are open. The New Zealand stock market opens on Sunday evening and closes on Friday after the New York stock market closes. Liquidity is best when stock markets in different time zones can be traded at the same time.
In some exchange-traded markets, larger players have been known to manipulate stocks or commodities in order to gain an unfair advantage. Given the high liquidity of the foreign exchange market, it is almost impossible for general exchange forces to intervene, which provides a fair and transparent market for all participants.
The Forex market has no limits and you can trade in both directions. This means that if you believe a currency pair will increase in value, you can buy it, or go “long.” Similarly, if you believe the pair will decrease in value, you can sell it, or go “short.”
The amount of money required to trade Forex is generally lower than that required to trade other financial markets. In addition, the Forex market can be accessed at any time through computer terminals and mobile trading terminals.
Forex trading can be done with leverage. Leverage means that you only need less money to leverage a larger position. For example, if you have $1,000 in your trading account, using a leverage ratio of 1:100, you can open a position worth $100,000 (100 times the amount in your account). However, it is worth noting that although leverage enables traders to open larger positions to maximize potential profits, the possibility of losses is equally large.
Due to the huge daily trading volume in the Forex market, volatility is always present. Increased volatility means more trading opportunities. You have the ability to choose currency pairs that suit your trading style. For example, AUD/NZD is a good currency pair for beginners to start trading due to its narrow daily volatility and low spread, while EUR/USD is more suitable for advanced traders due to its large daily volatility and the speed at which it rises and falls.
One of the main advantages of the foreign exchange market is its extremely high liquidity. The foreign exchange market is the most liquid market in the world, which is one of the main differentiating factors from other financial markets. The foreign exchange market has a daily trading volume of more than 5 trillion US dollars. This high liquidity means that your assets can be quickly converted into cash without any price discount, making it easy to convert a large amount of money into a foreign currency with little impact on the price.
Before using leveraged trading products, you should first consider your risk appetite and investment strategy. Using leverage has both advantages and disadvantages, which can increase profits and aggravate losses. If the market moves against you, your account may be liquidated. It is important to emphasize that you do not actually own the underlying product under the CFD. You can find a detailed explanation of the benefits and risks of CFD trading on our website. Product Disclosure Sheet
The cost of each transaction in foreign exchange trading is less than one-tenth of the average stock transaction cost. This saves a lot of costs. It also means that you only need a lower amount of capital to start foreign exchange trading.
The Forex market is an over-the-counter market, unlike the stock and futures markets. This means that Forex traders have flexibility in position size and can trade any amount between 0.01 standard lots (1 super mini lot) and 200 lots. This gives traders greater ability to manage risk.
KEBFX is a leading foreign exchange trading service provider.