Image by Gerd Altmann from Pixabay
Forex trading - or foreign exchange trading - is the biggest market in the world and it is something that many people around the world take part in each and every day.
Trading and investing is something a lot of us have thought about doing at one point in our lives, whether it be trading currency or something else or investing in property.
Currency is the biggest market for trading and today we want to talk you through some of the pros and cons of investing in currency this year to make some extra money at home.
Pros
There’s always opportunity
One of the best reasons to take a look at the forex market is that there is always an opportunity to buy and sell. This is the biggest trading market in the world with people trading over $5.9 trillion every single day. You will never have a dry spell when trading because there is always someone on the market at any one time to trade with.
It’s always open
The great thing about the forex market is that it is never closed. You will be able to trade with others around the world 24/7 as different markets will open at different times of the day. It means if you miss the UK market opening you can wait for China to open late at night or even wait for the Australian market and trade here during your downtime. Trading is able to fit around you and your lifestyle and is flexible to you.
You can win big
Trading can be a brilliant way to make money - and there are a lot of people out there in the world who make a ton of money through it. Trading on the forex market can bring big wins as long as you take the time to learn the essential strategies that govern it. You can really win big and delve into a whole world of knowledge by choosing to get involved in this market.
Cons
It’s risky
Every form of investment has a risk - but the currency market, in particular, can be unpredictable due to the current events around the world and the changeability of them. For example let’s look at the impact of COVID on many currencies around the world, or perhaps even the election of President Trump in 2016. There are many factors that could change the value of a currency in seconds so you need to be aware of the news and keep up to date with it while you trade to ensure you buy or sell at the right time.
You’ll be taxed
Tax is something you may not consider in the trading world - however, everything is taxed and you need to be ready for this charge. If you are unsure about tax for certain currency such as cryptocurrency, you can use some crypto tax software to help you calculate it. You need to decide whether the tax is worth the trouble of trading in the first place.
Make your own judgments on forex trading and see if this is the right hobby and money-making tool for you this year.