The Forex Market has long been known as a high risk investment. When you open a forex broker account you have to sign, that you have read the disclaimer that this type of investment is high risk. But the truth is the forex market is no more riskier then the stock market.
Over the last three years investors have been on pins and needles about where to place their capitol. Many long time good investments have failed and this has caused investors to overhaul their whole investment portfolios.
What many people do not know is that the forex market is much safer then advertised when the trading is done properly. The currency exchange market is the largest market there is trading Trillions of dollars a day.
The forex market offers a new way for beginners and long term investors to make great money during these uncertain economic times.
Forex Market 101
There are a few simple rules to follow when trading in the forex that will greatly help your results.
1.) Only risk 1% of your capitol at any time. The biggest mistake new investors make in the forex is trying to get rich on one trade. The forex market is designed to make money fast but you can also lose money fast. If you control your risk and be very conservative you greatly put the odds of winning in your favor.
2.) Set your trades up with at least a 2 to 1 ratio. So if your going to shoot to make 2% only risk 1% to do it. Just by using a proper risk to reward ratio combined with only risking 1% of your capitol. Your chances of reaping a great ROI are greatly increased.
Forex vs. Stocks
When you purchase a stock your all in. If that stock does not go up you are going to lose money. In the forex I may buy a currency today then see that I am wrong. I will then end the trade and sell that same currency later that night for a profit. In the forex I am not locked in.
The forex market is also open 24 hours. So no matter what my work schedule is, I can trade for a few hours a day and try to grab some pips out of the market.
With stocks if something happens in the world that makes your stock fall your in for a horrible ride. In the forex if something happens to make the market start moving up or down I can take advantage of it. In the forex you can take advantage of what ever is going on in the financial world. So your opportunities to capitalize are much better.
Finally it is not uncommon to make 15% on your investment capitol monthly in the forex market. Your bank is not giving you that kind of return with your savings account. I personally have seen months of 50%. This is what makes the forex market so attractive to investors.
You can slowly and conservatively build a great income for yourself in the forex market. You can also pick the right trade at the right time and make a boat load of money in seconds!
To me for what's going on in the world today. The forex market trumps the stock market where risk to reward is considered.
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