The Truth About Financial Markets

 

“The Forex market is the safest market in the world?!”

Of course you don’t believe this…

But YES! It’s an Axiom.

Why is it easier to trade successfully particularly in the Forex market?

The average daily volatility in commodities is over 1%/day. In stocks it is about a 2/3 of a percentage per day. And in Forex it is a third of a percent a day.

So you can clearly understand which market is more dangerous…

You can see stocks or commodities that are cut by 5% to 10%/day, sometimes even 30% – 50%/day. Some of us have seen rare cases of company’s stocks being cut by 50%-80% in a single trading day!   But you will never see a coin crashing like that!

Not even in a full year (Otherwise it means that the country has collapsed or is in non-repayable debts).

With a daily cycle of 5 trillion dollars – The forex market is the largest and safest market in the world!

Furthermore…

The forex market is not easily manipulated by external factors, like stocks and commodities are, but only by major central banks and countries and for a limited time. This makes currencies more predictable and accurate, and there is no advantage for large traders over small ones.

Everybody is equal!
No insider information or prior knowledge for anyone, such is the case with stocks or commodities

 For example:  – A CEO who is about to resign from a company or is suspected of something   –   Fiscal reports of companies 
                            – A drug that has not been approved     –      And thousands more examples of leaks     –    etc.

The Forex market is more solid and transparent, and therefore can be analyzed and forecasted more precisely without the advantage of institutional investors. 
Technical and fundamental analysis works more authentic on the forex markets, as in most cases it reflects the real economic state of the country, making the analysis more accurate.

The most significant and important advantage of the Forex market is its leverage!!!

 

So why isn’t everyone trading in the forex market?

Know that 90% of the daily turnover in the capital markets is from Forex!

 So what happened that has made the Forex market to be so feared in recent years?

There are three main reasons:

  1. The high leverage that brokers take from you (higher than 1:100).
  2. Non-regulated Internet companies that have sprung up like mushrooms, offering you high leverage with one goal only; for you to lose your money as fast as possible! 
  3. 100% conflict of interest between you and the brokers that don’t provide coverage on your transactions through prime brokers and big banks.


Caution!!! There is an absolute conflict of interests between you and them!

Now that you are more aware of the advantages of the Forex market but also of the dangers that certain companies hide from you…

Here are three golden tips for you:

  1. Most important of all: DO NOT TAKE HIGH LEVERAGE!!! The leverage is the Achilles’ heel of Forex trading. Learn more about Leverage.
  2. Choose a regulated company that you can rely on and trust that they will release you your money quickly and without asking questions!
  3. Choose only companies that offer full coverage on all your transactions through prime brokers or banks, limiting the chance of a conflict of interest.
  • Be alert of companies that don’t ask you for personal documents for compliance (KYC).

Choose your broker