Pros and Cons of Forex TradingBy Toby Tunwase October 4, 2020
Just like every other trading endeavor, Forex Trading comes with both pros and cons. There are bright sides as well as ugly ones. So, before you jump into the world of forex trade, you might just want to be sure of what you are getting into. Check out the pros and cons of Forex trading and decide whether it is appropriate for you.
We start with the Pros
- The Forex Market is very accessible
For an individual trading platform, the forex market will pass off as being very accessible. Within a few days, you can own a forex account and start it off with as low as Fifty dollars ($50) or less.
The forex trading market is also open 24 hours, five days every week.
- Sizable gains through leverages
There are provisions for leverages with easy access to them also. This merit is what transcends your gains from minimal to sizable.
- The tendency to yield returns rapidly
With the swiftness of growth on the forex market, leverages, and deep liquidity, there may just be that tendency to yield rapid returns on your capital, unlike other platforms.
Other pros are:
- Availability of automated trades.
- Basic and easy tax rules.
- Lesser commissions and fees.
And now to the Cons of Forex trading.
- Traders are at risk of unforeseen volatility that can be extreme.
- For small traders, they may not enjoy the price-fixing and influencing of significant traders.
- With less stringent regulations, there might not just be enough protection for traders due to the over-the-counter approach.
Forex trading is a potentially lucrative side hustle, yet, it comes with a handful of risks.