The forex market is the largest, most liquid financial market in the world with an average daily trading volume of more than $5 trillion. The world’s total combined stock markets do not even add up to this amount. Through technological advances in the electronic and telecommunications fields, networks of banks and brokers have gained access to an almost instantaneous transfer system of information, data and funds. With these cutting edge advancements in computerized trading, spot FX has gained a significant advantage over other financial instruments, as it is not limited to time zones and the strain of trading floors.
There are many reasons why people trade forex, with these being the most popular ones among them:
- The Forex market has the highest market trading volume out of all the markets.
- Traders can trade 24 hours a day, 5 days a week.
- Forex prices are driven by central banks, interest rates and geopolitical events.
- Traders who only have a small amount of capital can take advantage of its high leverage to get more lucrative trades.
- Traders can make profit regardless of whether there is a bullish or bearish market trend by trading on forex derivatives.