Today, all sorts of people are involved in the foreign exchange market, busily studying the fluctuations in currencies and ready to make trades when the time is right so they make money out of it. Many a small business owner is also in on the action, for a variety of reasons. But can it pay off?
It may be that a small business owner simply enjoys Forex trading and is something they do on the side; it can also be the case that they wish to substantially improve their own income. Plus, a small business owner may want to use profits from their business to make the capital grow and then reinvest the additional earnings into the business.
Whatever the reason for small business owners getting into Forex trading, one thing is certain amid all the possible risks that exist in this up-and-down market: you can do it on your own terms. The nature of the Forex market is that it’s far more fluid than the business-hours of the various stock markets. The Forex market is open 24 hours, excluding weekends, which means small business owners can dabble in it at any time of day, from their office desk, their home sofa or while travelling or on holiday. The potential for wins, small or large, are nearly always available.
A Great, Big Market :
The Forex market, quite simply, is enormous. It’s the largest financial market on the planet and is worth around $5.3 trillion a day. That works out to about $220 billion in Forex trading every hour. To put it in perspective, the futures market has around $437 billion in daily trades; the entire equities market is worth an average of $191 billion; and the NY Stock Exchange sees some $28 billion in trading every day.
There is a lot of trading going on in all financial markets and there are many players in the Forex market. They include banks, institutional investors, corporations and currency speculators. It’s this last group that includes all kinds of people, including small business owners. It’s estimated they make up around 90% of daily Forex trading as they get in on the highs and lows of currency movements.
One of the biggest single currency speculations ever occurred in 1992, when Hungarian-American billionaire George Soros bet against the British pound — and made $1 billion in 24 hours. The famed investor had poured $1.5 billion into the UK currency as he believed it was going to be devalued, and when it declined, he famously ended up “breaking” the Bank of England and walking away with a gargantuan payday.
Essentials for Forex Success :
What’s the lesson from Soros’ success? Know the market and closely follow all sorts of events. Many developments have the potential to derail a currency or send it soaring — from elections to wars, natural disasters and many more. Also for the small business owner trading Forex, knowing how to trade and what to do are essentials they need to get to grips with from the start.
It can be enormously advantageous to take a short course in Forex trading, which are now available online. Traders also benefit from keeping things simple and only using the information and data they need to make successful trades. This is instead of spending all their time poring over all kinds of complex charts, graphs and everything else displayed on multiple screens that ultimately is of little use to them.
The psychology of Forex trading is another key aspect of those who do well; being disciplined and knowing exactly when to strike to make the most of your trades. It could well end up as a small business in its own right.
This post complies with my Disclosure Policy.