The economic compulsion of the present time demands that no matter where you invest, your money must be secure, and the returns prompt and assured. Whereas the old die-hards are still sticking to the idiosyncrasies of the conventional stock market, the new breed of investors have come to accept that the foreign exchange trading (forex) provides the best opportunities for retail traders today.
With trading of over $4 trillion a day and round the clock functioning of the markets, five days a week, it has become the most widely traded market in the world. This has its advantages. More flexibility is assured and transaction costs are lower when compared to other financial markets. But these would be meaningless unless you have sound forex trading policies in place.
There is no denying that with judicious planning there is plenty of money to be made in the forex trade. But what also needs to be remembered is that there are millions of dollars invested by international banks and countries who are in for the long haul . And, whereas a small error of judgement or an international incident, may end up being a minor nuisance to big time investors, it is more than likely to wipe off all your assets completely.
When you are dealing in the stock market you buy shares and keep a watchful eye on how the company is doing so that you can sell out as and when the share prices peak, and you can make decent profits. On the other hand in the forex markets you are buying a product (currency) and your profit or loss will fluctuate on a daily basis depending on the cost of currency from country to country.
If you find yourself bogged down in calculations, and an overdose of computer programs it will not be long before you realize that you have made the wrong choice, and forex trading is not for you. Call it “beginner’s luck” but many traders do get lucky initially and hit big winners but due to lack of maturity and proper guidance, their success is often short lived.