As one of the most dynamic and lucrative financial markets in the world, it’s no wonder why the forex market is so desirable to both trading veterans and novice traders alike. While it was once only available to corporations, central banks, large financial institutions and those from a very wealthy background, thanks to the internet, it is now possible for people from all walks of life to start trading forex.
So, for those entrepreneurs looking to set up their new business venture, the forex market offers an opportunity for new businessmen and women to utilise forex trading to make some additional money, as well as learning transferable skills from this industry that they can implement into their own business practices.
- High degree of accessibility
Arguably one of the most attractive features for entrepreneurs looking to enter this market is the ability to begin trade with a relatively small amount of capital. In this market, the minimum deposit brokers are likely to accept when opening an account is $100, meaning that initial risk factor is a lot smaller than when trading in other sectors such as the stock market.
Not only are you able to set up a live account with a small amount of capital, but, due to the global interconnectivity of the market, traders are able to place trades 24 hours a day, 5 days of the week (from Monday to Friday). As such, running a full-time business during the day causes little detriment to your forex strategy, as you’ll be able to concentrate on your trades in the evening from the comfort of your own home.
- Forex offers leverage
Another benefit of forex trading is that this market offers a lot of trading leverage. Not only is this true for high amounts of capital, but in the forex market, even small amounts of capital can produce substantial gain. For example, a broker may offer a 50:1 leverage, meaning that a $5 dollar margin deposit would allow a trader to buy or sell $250 worth of currencies. Similarly, with $5000, a trader could trade with $250,000.
However, it’s important to note that along with the potential for success, leverage also means that there is a higher potential for greater losses with smaller amounts of capital. As such, traders should be sure to execute proper risk management strategies to minimise loss potential.
- Limited knowledge needed – demo accounts
Not only is forex an accessible market, but due to the skills needed to trade in this market being incredibly adaptable and transferable, this type of trading is particularly easy to learn as a beginner. Not only are there forex seminars led by professionals available to help those eagerly wanting to enter the market successfully, but many tips, strategies and resources are readily available on the internet for anyone to use.
Alongside this, most forex brokers allow those new to the industry to preview their platforms and services and, as a result, offer unlimited demo accounts for traders to practice on without having to use real money – therefore eliminating risk early on.
- Help support your business
As forex can be traded outside of typical working hours, entrepreneurs are able to run their business without risking its growth potential. What’s more, as mentioned above, due to the strategic and budgeting skills learnt from trading, the approach you take to grow your business could benefit from such skills.
Not only does venturing into forex trading offer you the ability to transfer your skills from business to business, but part-time trading could allow you to benefit from additional income to help fund your entrepreneurial business.
So long as you remember to remain responsible and never risk money you cannot afford to lose, trading forex could be a viable option for those of you beginning your entrepreneurial career. As such, continue to do your research to increase the potential of success for both your trades and your entrepreneurial career.
John James is a content writer for Learn To Trade, the foreign exchange education and learning specialists – offering a range of training courses to help people understand the currency trading market, as well as its opportunities and risks.