Advantages and Disadvantages of Hiring Forex Brokers
The foreign exchange market, also known as the forex market, is a huge cog in the overall world financial system. In terms of volume it is the largest market in the world, even larger than the credit market. This is simply because it is essentially the market surrounding the exchange of money for money.
Confused by what I mean by that? The foreign exchange market concerns itself with different currencies and how they are traded. A trade of U.S. dollars to euro is one example of a forex transaction. Since the values of all currencies & their equivalent value in other currencies fluctuates on a daily basis, some shrewd traders have capitalized on this and began lucrative careers in trading foreign currencies. How exactly does someone acquire foreign currency to then trade? Well, they hire a forex brokerage firm to help them acquire the currency they desire and then make trades. Brokers all operate differently, however, so here are some of the advantages and disadvantages that can come from choosing to hire a broker:
Easy Access To Foreign Currency
Had you not chosen to enlist the help of a forex broker, you would have to go down to a brick and mortar currency exchange and then either sit there all day waiting for a lucrative trade opportunity to come up or rush back there to make a trade while the getting was good. Currency exchanges are looking out for their own interests as well, so their fees are typically higher than what forex brokers charge.
Access To Practice/Demo Accounts
Most brokerage websites give you either a limited amount of money or unlimited funds to play around with before you begin trading for real. This allows you to get a feel for the markets without having to lose thousands of dollars in savings and truly understand if forex trading is right for you.
To make signing up for their particular service over another more desirable, many brokers offer bonuses to those who would like to sign up, like $30 in free credit or extra money per every dollar deposited that can be put towards trading. The comprehensive list of brokers who offer bonuses, by Connectfx.org is a great resource for checking out these bonuses.
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