Whether you want to break free from the tiresome 9 to 5 work life and save more, or you simply want to achieve financial freedom faster, forex trading is the best way to go. With an average daily trading volume of more than $5.3 trillion, Forex is the biggest global financial market. It, therefore, makes sense why any smart individual would consider such a large financial resource to reach their financial goals.
Question is, how exactly would Forex trading help you attain financial freedom?
It enables you to make big wins for less
One of the biggest advantages of the Forex market is accessibility. It allows you to begin trading with as little as $50 to $100. With it, you don’t need to make a large deposit. All you need to do is be consistent and patient while trading to see your small amount grow exponentially. It’s not uncommon to see people starting with a couple of dollars and making seven-figure returns out of it.
It is profitable
The forex market can multiply your investment ten-fold in a single day. You can make money whether the currency you’re investing in goes up or down. On the other hand, the stock market only allows you to generate returns when your stock’s worth rises, limiting how much or how often you can profit from your trades. Perhaps the best part about the forex market is that you work with currency pairs. When one currency rises, another falls, thereby making forex a profitable two-way market. It’s no wonder many people quit their jobs after making a lot of money through forex trading.
You get to benefit from high liquidity
If you want to achieve financial freedom, you have to go where the money is. The fact that the forex market trades more than $5 trillion each day makes it an ideal destination. Indeed, individuals, banks, and other institutions convert currency worth trillions of dollars daily, and this activity is mainly geared towards generating profits.
This high liquidity means that the transactions are executed and completed fast and easily; therefore, the transaction costs are usually very low. This is important because it creates an opportunity for any trader to make accurate guesses on price movements.
What’s more, as a trader, you can easily set a goal, and enter or exit your position without being worried much about major price shifts before executing a trade.
Whether you want to buy or sell, there will always be someone on the other side waiting to take your deal.
It enables you to trade a wide range of pairs
Any individual looking to achieve financial freedom has to ensure they have many options or avenues of making money. In the forex market, there are many currency pairs reflecting different economic trends in the world. That gives you an opportunity to make more money based on different global events, political trends, and the relative strength of different economies. There are forex trading platforms that allow you to choose from up to 100 pairs that include major currency pairs, such as EUR/USD, minor pairs, such as CAD/CHF, and exotic pairs, such as USD/MXN.
You can trade all these pairs from a single account.
You can minimize risk
Forex enables you to make money while reducing the chances of making losses through hedging. Hedging is a simple method of reducing the chances of making bad moves through multiple strategic positions.
For instance, you can hedge by using many currency pairs with positive correlation and take positions in the opposite direction to lower downside risk. For instance, when you short EUR/USD and make a loss, you can mitigate it by going long on GBP/USD.
If you don’t really like taking chances, there are ways in forex trading to help you play safe. When you learn online forex trading and understand the basics, you’ll be able to set your trading platform to close your positions when you reach the profit amount you’re intending (to avoid any surprises) or to exit the trade if the trend starts moving against you. If you want to achieve financial freedom, there are many reasons why Forex trading would help you with that. As we’ve just seen, Forex trading is profitable, accessible, less risky, and diverse