Benefits of Forex Market

Benefits of Forex MarketTrading theForex market has some advantages over other financiaros market, among theimportant ones are: liquidity, 24hrs market, leverage, low transaction costs,small investment, specialized operation anywhere operations among others.Liquidity - The Forex market is by far the most liquid market in the world with more than2 trillion daily volume according to the Bank of International Settlements.Why is liquidity important to us? It helps in the following ways:- The most important advantage of all is that with the superior liquidity helps to have moreprice stability. With such a large market, almost always going to be someone interestedbuying or selling in the "current" price, making it easy to open and closeoperations. Recall however, that there are periods of high volatility which isprobably we do not have a difference between the price you want and they give us.- In the highly liquid, most of the time, we can enter the market with executionsconsistent, but as other markets in periods of extreme volatility we haveinconsistent performances.- The very high liquidity also makes the forex market is very difficult to manipulateextensively. If any of the participants would like to manipulate, I need hugeamounts of money (millions) making it virtually impossible.Volume Generated by Country[Table 1]Source: Bank of International Settlements (BIS) 2006 SurveyIn the above chart we can see that UK and US They have about 50% oftotal volume, as a rule of thumb, the more volatility there is, the larger themarket movements. We'll talk about this in future lessons.Market 24