Let’s consider the differences between instruments traded when trading stock VS trading Forex.
Obviously the nature of the instruments being traded between stock trading and Forex trading is quite different. In the stock market, a trader will buy or sell a share of a specific company in a certain country. There are several stock markets in the world, and these markets are affected by different factors including the local situation of the country to determine the valleys and peaks of the prices of stocks.
Forex trading, on the other hand, involves purchasing and selling pairs of currency. In a Forex market transaction a trader will usually buy one currency from one country, and then would sell the currency from another. Hence, the transaction is referred to as an exchange.
Forex traders generally estimate the rise and fall of the currency trades betting on the monetary policy of a specific country as well as the economic perspectives. These factors affect the difference between the two currencies in the currency pair.
While the stock market is managed by established governing bodies, Forex trading is facilitated by financial institutions operating on certain levels. Banks may form smaller financial firms to serve as Forex dealers to focus on exchanging large amounts of currencies. Because of the issue of sovereignty between two currencies on exchange, the market is less regulated and so more flexible compared to stock trading.
If the video is a bit over your head, I wanted to provide a few additional notes to give you a true beginners introduction to the Forex market. If you are somebody interested in getting started trading from home, you may have heard that the Forex market is a good place to get started. In fact, there are some Forex traders who make millions of dollars without trading any stocks at all!
But, before we delve into talking about forex trading, let us talk about the foreign exchange market. In essence, the foreign exchange market is is where currency trading occurs. Because currencies are valuable to majority of the world’s populace, there is a need for currency exchange to be carried out so that foreign trade and business can progress and develop.
For instance, if you make your home in the U.S. and you wish to purchase wooden tables from the Philippines, this transaction will require either you or the company that you will be purchasing the tables from to pay the Filipinos for the tables in Philippines pesos (PHP). In order for this to happen, the U.S. importer would have to engage in exchanging the equivalent value of USD into pesos.
The same applies when one is traveling. It is not possible for an American tourist to pay in dollars when in London, for the simple fact that the local currency is different. Be that as it may, it is essential for the American tourist to exchange his or her dollars into the local currency, which is the Great British Pound or GBP. This is the basic premise and necessity of forex trading.
Let’s face it, most of us don’t have the time, or the drive to study the market the way somebody like Warren Buffet does and take consistent action every day. Sure listening to somebody like Buffett can be very helpful as far as designing long term investment strategies. But, if you are somebody looking to make some quick cash as a trader, you may be looking for ways of trading that are cheap and easy to get started with that don’t require you to become a student of the stock market.
With the increase in popularity of alternative investment strategies, such as binary options trading, there’s no surprise that the market of trading software applications has arrived in full force. Obviously, there’s a huge draw to utilize automatic trading system when dealing with binary options. Binary options are relatively simple to utilize and trading bots can operate, at least in theory, twenty-four hours a day, seven days a week.
The problem arises, however, when the market gets flooded with sub par products looking to make a quick buck and take advantage of the popularity of something like binary options in general.
So, where does one look to decide which binary trading robots are legit and worth checking out? Well, the quick answer is, “do your homework!” Essentially, there are certain indicators that a trading bot is worth your time and money. For one, search for the various reviews. If an piece of software has been reviewed by countless reviewers out there on the internet, take a look at what they have to say. Often times, they will break down the basics and provide the pros and cons of the software. Another think people should look for is what’s included in the purchase to determine whether it meets their needs. For example, one person may find that customer service and availability of one-on-one assistance is the priority. Someone else may not care about something like that and simply cares about whether the software does what it’s supposed to do! So, in the end, it depends on the needs of the individual really.
One thing to keep in mind is that many of these new trading robots are really just the same software systems that have merely been repackaged and sold with different marketing to make a quick buck. That is why the new Legal Insider Bot has become so popular. It was designed by a guy named Greg Marks who has apparently managed some pretty serious funds and he had the software created for his own personal use.
By all means, if you find something that has no reviews whatsoever, that may be an indication that you want to stay away—at least to be on the safe side. It’s always best to go with what’s been in operation and with the ones that have generated positive feedback from reviewers and users!