Several companies offer automated forex broker services. In the following articles, you'll find brief reviews of each. What forex brokers offer automated services? GFT Forex is an automated forex broker, whose DealBook FX 2 software offers the investor both a demo and a live forex trading tool in the currency market. This forex trading software offers the investor direct access...

Major Advantages to Trading Forex

Francis Gillen

When most investors hear the word forex, the words that flash through their brain are "risky," "complicated," and "tiny profit margins." This is because the information on currency trading isn't as available and easy to access as the stock market. A stock investor just needs to pick up the Wall Street Journal or turn on CNBC to instantly see what's new and exciting. When you're a stock investor, you can talk to your friends, neighbors, and co-workers about what you're buying, share tips, and brag about your profits. Everyone is familiar with the stock market. Forex is a different beast. To find information, you have to turn to the internet or privately run newsletters. You can't talk about forex with anyone in your everyday life because they won't understand the lingo and will have no idea what you're talking about. It's a shame, because our game has some major advantages over stock trading. Maybe if forex information was more public, the average investor would realize the following 5 things to be true.

One thing that most people doesn't realize is that there is no trading commission involved in currency trading. When you're trading stocks frequently, even if it's done online at $20 a pop, the fees start eating into your profits. If you're trading options, you're not only paying a commission on the trade, but you're also paying additional fees per contract. Fortunately for forex investors, the only retail transaction cost is the bid/ask spread which is usually less than 5 pips (0.05%).

Secondly, the currency market is open 24 hours a day, 5 days per week. Unlike the stock exchange, which is only active between the opening and closing bells, you can trade forex first thing in the morning or in the wee hours of the night. There are people all around the world trading at all hours, so a trader can take advantage of any market condition at any time.

Another big benefit to the foreign exchange is the huge leverage opportunity. Leverage, also called margin, is when you borrow your broker's money and add it to your own capital in order to make a larger investment. In the stock market, you have to pass your brokers strict guidelines to be approved for a margin account, and if you do, you'll get a maximum of 2:1 (which means if you invest $10,000, you can borrow $10,000). In forex, a ratio of up to 400 is considered normal. If you use that massive amount of leverage properly and hit some big winners, you can make substantial money in short periods of time. Of course, the opposite is true as well. You can lose substantial money very quickly also. But you can't get a better opportunity to use other people's money.

A fourth advantage to currency trading is it's size. Because the forex market is so huge and has so many traders active at all times, no single investor can corner the market. In the stock market, each equity issue has a finite amount of outstanding shares. For many small cap companies, a large investor could amass a large percentage of those outstanding shares, and because of the low liquidity, their choice to buy, sell, or hold will have drastic effects on the price of that particular stock. With currency, no single investor, not even a central bank, can accumulate a controlling amount of something like the dollar, pound, or franc.

The last great characteristic of the forex that we'll discuss in this article is the never ending bull market. Forex is a zero sum game. A gain is only made when one currency rises in value in relation to another currency. So this means that if one currency is going down, another is going up. In the stock market, when a bear market hits, the vast majority of stocks are all going down. If Microsoft drops 5 points, that certainly doesn't mean that GE went up 5 points. Sure, you can short stocks in a declining market, but the average investor isn't too keen on the unlimited downside risk and probably doesn't even have the margin to be able to make the trade. Just remember that something is always guaranteed to go up in the currency market.

There are dozens of other reasons why the forex is one of the best playing fields in the investment world. If you are an investor, do some research and see for yourself. Open up a demo trading account at one of the several online forex brokers and see how you do. You might just find that it blows the stock market out of the water.

About the author:

This article is just a small piece of the free Forex Trading Course at forexgameplan.com. Go learn about this incredible market and sign up today while the 30 day course is still free.

The latest information and news on Forex:

forex - Google News

Euro Forecast to Recover Against US Dollar on Options Sentiment - Daily FX

FXstreet.com The Forex Market
Euro Forecast to Recover Against US Dollar on Options Sentiment
Daily FX
Forex options risk reversals show distinct risk that the US Dollar may slip further against the Euro, Australian Dollar and New Zealand Dollar through ...
Forex: New Zealand Rate Decision and the Feder...
WORLD FOREX: Euro Gains As Global Economic Picture Brightens - Wall Street Jo...

Reuters
WORLD FOREX: Euro Gains As Global Economic Picture Brightens
Wall Street Journal
NEW YORK (Dow Jones)--The euro shook off lingering concerns over sovereign debt Wednesday to gain against the dollar ...
FOREX-Euro, sterling pressured by fiscal concernsReuters
FOREX-Yen firm, euro and pound hurt by...
FOREX-US dollar down vs euro; yen falls on easing bets - Reuters

Earthtimes (press release)
FOREX-US dollar down vs euro; yen falls on easing bets
Reuters
NEW YORK, March 10 (Reuters) - The dollar slipped against the euro while the yen fell on Wednesday, as risk appetite improved in ...
FOREX-Yen down on concern ahead of BOJ, pound slipsReuters India
Yen Gains on Spec...
WORLD FOREX: Euro Ticks Up Vs Yen On Japan Importer Buying - MarketWatch

WORLD FOREX: Euro Ticks Up Vs Yen On Japan Importer Buying
MarketWatch
... that Japanese importers' buying flows became more dominant and set the trend, said Yuzo Sakai, a foreign-exchange manager at Tokyo Forex & Ueda Harlow. ...

and more »
The Trend Trader For Forex Trading on Thursday, March 11, 2010 - Inside Futures

The Trend Trader For Forex Trading on Thursday, March 11, 2010
Inside Futures
The Trend Trader helps to identify the current trend status of your favorite forex markets. It not only helps us to stay ...

and more »
foreign exchange - Google News

China On Gold - Stating The Obvious - istockAnalyst.com (press release)

Washington Post
China On Gold - Stating The Obvious
istockAnalyst.com (press release)
Reuters reports on comments made by China's top foreign exchange manager at the annual gathering of the National People's Congress in Beijing on the subject ...
Play the Chinese Yuan's Fortunes with These E...
WW Grainger's daily sales up 12 percent in Feb. - The Associated Press

WW Grainger's daily sales up 12 percent in Feb.
The Associated Press
... Inc. said Wednesday that its daily sales rose 12 percent in February on acquisitions, seasonal product sales and favorable foreign exchange rates. ...
Grainger Reports February 2010 Sales ResultsMarketWatch (press release)
W.W....
RPT-Q+A-What foreign exchange reforms are brewing in Brazil? - Reuters

RPT-Q+A-What foreign exchange reforms are brewing in Brazil?
Reuters
Brazil's foreign exchange legislation includes law 4595, which creates the central bank and gives the national monetary council the authority to formulate ...

and more »
Grey Horse Reports 2009 Results - MarketWatch (press release)

Grey Horse Reports 2009 Results
MarketWatch (press release)
Our foreign exchange business continued to grow, and we completed our acquisition of Toro FX Inc. -- the level of interest rates remained low, ...

and more »
Lone Star to resume $3.9 billion KEB stake sale: KEB - Reuters

Lone Star to resume $3.9 billion KEB stake sale: KEB
Reuters
KEB has strength in foreign exchange trading and trade financing, and employs 7500 staff. A buyer would be able to leverage KEB's foreign networks to head ...

and more »