Why Trade Forex Online

You may be new to the currency market, and might be wondering why you should trade the forex? This is an excellent question, and this unique market offers many benefits not found in other venues. These include instant data reporting and trade execution, the best trading platforms in the investment industry, high margin capabilities and progressive brokers. To help you discover what the forex market can offer to you, let's examine each of these topics in more detail below.

Fast Reporting and Execution

One of the best features of the currency exchange, is the near instantaneous nature of its data reporting and trade execution. This is unlike other markets, which have a physical trading floor. This slows down the entire process, as manual reporting is required, and this creates a lag in data creation. How so? For example, on the Chicago Mercantile Exchange or CME, commodities are traded in separate locations called pits.

In the center of each of these pits, is a team of people whose sole job is to report the trades which they hear being called out. The traders themselves stand around the pit in a circle, shouting over this central hub. As you can see, this is an inefficient method, and not all trades can be accurately reported.

In contrast, not only does the forex have some of the best trading platforms today, it is entirely electronic. There are no physical traders shouting out orders, only electronic trades sent in from all over the world. This ensures that every trade is precisely cataloged and reported to your screen in mere seconds! That means there is no advantage given to professionals or large brokerage firms, making the forex one of the best markets for personal traders. With an even playing field, you have the same opportunity to profit, whether you have a large or small account balance.

The Best Trading Platforms in the Industry

Because the forex is completely electronic, it allows for highly sophisticated trading approaches. Currency brokerage firms offers some of the best trading platforms in the industry today, which are based upon the seamless data stream of this market. These give you many different tools to analyze price movement, and you can craft a unique trading strategy based upon extensive back-testing. Unique charting options and drawing programs are included as well, which afford you the chance to examine the market from a variety of angles.

The best forex trading platforms also offer many different trades as well, from Stop Loss to Market orders. The most advanced software packages provide automation too, allowing you to implement a strategy even when away from your desk. In fact, this single function may be the most valuable, as often traders bend to the pressures of the market in the heat of the moment. Automatic trade execution gives you the option to remove yourself from the equation, to ensure you follow your preset trading approach faithfully.

High Margin Limits

Another benefit of trading the forex market, is the high margin limits which it provides. Many brokerage firms offer high leverage ratios, with 200 to 1 being a common allowance. For those with more trading experience, or funds to work with, you may be awarded an even higher margin ceiling. 500 to 1 leverage ratios are not unheard of, and this can increase the size of your gains by a staggering amount. For example, at just 200 to 1 leverage, a gain of only 0.5% will double your money!

This highlights the importance of using the best forex trading platform possible, as careful management of your trades is paramount. How so? Leverage is a two-edged sword, and not only will your gains be magnified, but your losses as well. Yet, when you use the most powerful software available today, you will have the tools you need to appropriately prepare for any market condition.

Progressive Brokers

The forex market lends itself to innovation, and currency brokerage houses are no exception. Many offer you the best forex trading platforms completely free of charge, as an added bonus for opening an account. Further, they extend convenient funding options and many will provide deposit bonuses as well. This is not a standard industry practice, and it is one which you will derive great benefit from.

So, if you have been asking why you should trade the forex, you now have a clearer picture of its many advantages. You'll experience fast reporting and trade execution, the best trading platforms in the industry and high margin limits. You can also work with some of the most innovative brokers in the world, which will extend wonderful extras like deposit bonuses. So, why not open your trading account today, and begin to benefit from these excellent features?