Trading, whether it is stocks, commodities, or derivatives
(like futures and options) can be a very lucrative business
to be in.
With the decision to become a trader, you must also choose
what type of market you will focus on and what instruments
you will trade. Will it be shares of publicly traded
companies, commodity future contracts like oil and gold, or
currencies.
Most of the financial markets that exist in the world today
are within the framework of a central exchange, and for
that reason they are limited in their scope and daily
trading volume. Every market except one, which is the
foreign exchange currency market.
The foreign exchange (forex) market has no central
exchange, and instead it exists only as a highly
interconnected web of bank servers and individual brokers.
The 'over the counter' type of trading tends to be much
larger in scope than trading centered around a central
exchange (such as the NYSE), and for the reason the forex
market is hands down the largest financial market in the
world with daily volume surpassing $2 Trillion USD.
The forex market is the only true global market that
exists, as it is not based in one specific country and
instead is created by the perpetual buying and selling of
banks and financial institutions in every major city, 24
hours per day.
Unlike traditional exchange-based markets which have set
times that they are open and closed, the forex market
literally follows the span of daylight around the planet.
When you are a forex trader you need to be familiar with
the term 'global trading day.' The global trading day
begins with the London market open hours (about 3AM New
York time) and continues across all the major cities and
time zones.
There are three distinct times throughout the global
trading day when there is the most trading activity (and
consequently the most liquidity). These times are based
around the open-hours of the three major cities in the
world where the largest volume of forex activity takes
place: London, New York, and Tokyo.
So what does this mean for you, the trader? Because the
forex is a global market and there are no set open and
closed times, it is possible to trade at any time during
the day (except on weekends).
It also means that due to the level of daily trading
volume, this market is very liquid and it is virtually
impossible to get 'stuck' with an open position.
Because of these lucrative trading features, many firms and
brokers have sprung up to cater to the large demand of
forex market access. Many of these companies offer highly
advanced trading platforms that feature very low commission
trading and seamless market entry/exit.
All in all, forex trading is by far one of the coolest ways
around to make money today, since all you really need is a
broadband-enabled laptop and a funded trading account to
make money from anywhere in the world.
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Get more free education and ebooks about the forex market
at http://TheForexSurfer.com/ebooks , and also learn about
a highly profitable trading strategy called Forex Surfing.
http://TheForexSurfer.com
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