All forex investments have certain characteristics in common which when applied properly can help raise profits. The reason most persons dabble into forex for a while and walk out complaining about losing money is that they come in with the wrong intention which is to hit it big without putting in any work. But this is not the case, the harsh reality is that irrespective of what a majority of the public may think, forex is a legitimate business with the same rules of engagement. The overreaching implication of this is that, basic business virtues, ethics and laws apply here too. In this article we are going to X-ray what one stand to benefit when the important concepts of proper planning and execution are well applied in all forex investments.
WHY PEOPLE FAIL TO SEE FOREX AS A PROPER BUSINESS
Before we delve into the benefits of the virtues of business in all forex investments, lets dwell a while on why a few people see no point in applying the same principles that hold sway in other businesses in forex. This will make it obvious as to why so many forex traders fail early and lose the heart to try again.
- LITTLE REGULATION:
Though there is a hand full of checks from regulatory agencies in various countries to control the excesses of forex dealings, the reality is that forex is not as heavily regulated as the insurance sub sector and telecommunications for instance. This is an industry that runs not less than 5 trillion dollars on a daily basis; why is there so little regulation? But nothing can be far from the truth more than this assertion, as forex is not completely under the jurisdiction of any single nation, since a trader can be in one country and trade currencies that are not his/her home country.
- NEGATIVE PUBLICITY:
Forex in all sincerity has not enjoyed the goodwill of the main stream media especially in developing countries. This has furthered speculations that there had to be something illegal about it, since everyone seems to be saying so. But of course truth about anything is never established based on the number of its proponents although we tend to be tempted into feeling so. When people don’t understand a concept fully, they mystify it. This has been the fate of forex.
BENEFITS OF PLANNING AND EXECUTION:
Like in all business, before ever there is an action there must first be a plan backed out by a thorough research. The importance of planning in any undertaking cannot be over said. In forex, this may include a careful consideration of all forex investments before choosing one. A little later in this article, we would list some of these forex investments. Execution on the other hand is what happens after a successful plan has been drawn. The trader now has to carry out his plan, making sure that eventualities along the way are well handled.
WAYS TO INVEST IN FOREX
Standard trading account; this is the simple account you open with a broker of your choice from which you can trade
Foreign mergers and bonds; you may have a stake in mutual funds that buy into foreign mergers and government bonds, the interest always increase when your local currency is slightly more valuable.
multinational corporations; multinational companies often have the privilege of making more profit if the foreign currency rises as opposed to the local. Investing in such companies increases your earning power.
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.