Foreign exchange trading, or forex trading, is a popular alternative for working and non-working men and women to generate income as long as they are well-educated enough to handle their own. To the uneducated, forex trading seems intimidating as there are so many things to keep track of in a single screen and they will be confused about where and how to start trading. Although forex trading is banned in some countries such as India, France and North Korea, Malaysia considers it as legal under the condition of traders applying for a license with a trusted forex broker and approved by Bank Negara.
Forex brokers such as IG, Saxo Bank, CMC Markets and Interactive Brokers are some of the few forex brokers in Malaysia that Malaysian forex traders can apply their license for as these brokers are regulated brokers which means they are under the supervision of the authority to ensure that these brokers are operating under legal methods and abiding by the rules and regulations implemented. Applying a license from these forex brokers provides multiple benefits with one of them being allowed to have transparency of the operation to ensure that the traders understand how they work and where their money goes when they are making a trade. Additionally, traders are ensured that their money is protected as brokers will have an account to hold their money to ensure it is not mixed with other funds. Additionally, most forex brokers offer beginner traders a demo account with limitless funds to get their first experience in trading before they decide to legitimately invest into it.
Different forex brokers also offer different kinds of bonuses when traders sign up for their services such as sign up bonuses, referral programs, deposit bonuses and more. However, those who are uneducated or unfortunate might run into risks of being scammed by some of these brokers as the scammers who offer an insanely high withdrawal limit, refuse to return the money you earn or confuse naive traders to hide their ulterior motives. According to Wisestep, traders who successfully performed a transaction, brokers will place a fee on any transaction they have made so traders must be aware of the fees they will incur onto themselves. In addition to that, the trade market does not wait for anyone as it operates 24/7 which could be a disadvantage for some traders when they miss the perfect chance to trade while they are asleep. The trade market is also a risky business due to unforeseen circumstances able to devalue the stock market that you invested in and could result in a major financial loss.
Although forex trading can be easily done by anyone as long as they understand what they are getting themselves into, they need to understand the risk they are signing up for as one bad move can lead to a huge financial and it will be difficult to gain back them back without investing more money. Overconfidence can also be a trader’s downfall if they do not learn self-control and fail to predict the outcome of certain trades.
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