Advantages of trading in the currency market 2023

What are the advantages of trading in the currency market? Is trading in currencies profitable? What are the disadvantages of trading? How much profit from trading? Trading Is it haram or halal?

Advantages of trading in the currency market

Forex is the largest financial market and has the highest liquidity due to the presence of many categories trading in the market, and this is not only one advantage, but resulted in two other advantages that had a strong role in supporting the development and spread of the currency market.

Execution of your transactions on currencies takes place immediately in Forex, i.e. without delay for buying and selling orders due to the availability of huge amounts of offers and requests at all prices, unlike other financial markets with little liquidity where there is a kind of delay in execution in purchase deals, for example, until a seller is available at the same price, Conversely, the execution of sales deals is delayed until the buyer becomes available.

Transparency and difficulty in manipulating price movement

Advantages of trading in the currency market with an average daily trading volume of $7.5 trillion ($7,500 billion) makes manipulation of market prices by traders in the forex market impossible because that would require huge liquidity unlike what happens in stock markets of speculative control or A trader in the downward or downward movement of the share price.

To complement this point, we answer an important question related to the reason for this liquidity and the huge trading volume in Forex, which is:

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Advantages of trading in the currency market
Advantages of trading in the currency market

Who trades in the currency market?

One of the advantages of trading in the currency market is the heart of the forex currency market dealings is the major investment and commercial banks in the world that carry out currency exchanges among themselves in the so-called “interbank market”, and these investment banks number more than 2000 banks around the world and are considered The cornerstone of regulating forex trading operations

Then the major investment banks fall into two categories of traders. The first category is traders for the purpose of speculation and profit from price differences in currencies. They are investment funds, investment management companies, hedge funds, and brokerage firms, which in turn provide forex trading to their clients from small individual traders.

As for the second category, they are traders for other purposes, that is, they do not seek profit from trading in the currency market, but rather they want to trade currencies with the aim of obtaining foreign currencies for commercial purposes, such as central banks that buy currencies from the forex market to provide foreign exchange for their government, and also multinational trading companies that You need foreign currencies in order to import from the global markets.

Forex trading is open 24 hours a day 5 days a week

One of the advantages of trading in the currency market is that there is no such thing as a forex trading session, unlike the stock market, for example, in which the trading session is restricted to a specific time for opening and closing. Deals cannot be executed before or after, but in the forex currency market, a trader can execute his deals in forex All day, without the need to be free or adhere to a specific session time, and the forex market is closed on the weekends on Saturday and Sunday only.

This happens as a result of the succession of forex trading operations through various markets and financial centers around the world, as the forex trading day begins in New Zealand, advantages of trading in the currency market then Australia, specifically in the Sydney market, followed by Tokyo, the financial center in Japan, which is representative of the Asian period, then Hong Kong and Singapore.

From the advantages of trading in the currency market, after a few hours, trading begins in the Middle East from Bahrain, then in Europe, specifically from London, the largest financial center not only in Europe but in the world, and finally in the United States of America from New York, where the day ends to start again a new day in New Zealand.

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