This video provides an overview of the Foreign Exchange market. It is perfect for those who want to have a general summary of the ins and outs of the Forex that make it different from other markets.
It really gets down to the fine details about how the currency trading market works as well as the pros and cons when comparing it with the stock and futures markets.
The video splits up into the varying aspects of the currency trading process itself and makes a lot of comparisons with other markets such as the stock and futures markets. It starts by stating the 24 hour liquidity of forex trading. It mentions how the advantages are that the trader can determine their own activity hours but it does touch upon how there is less slippage than other markets and some traders can become addicted after finding it hard to pull themselves away from the market given that it is constantly active.
Leverage is an area briefly outlined. More leverage is provided for traders by brokers on the foreign exchange than many other markets. Many firms offer up to 200 to 1 leverage which could potentially allow for a 0.5% movement to transform into 100%. The small price change also gives the traders the opportunity to customize the market to their needs. However, it is well known that many new traders lose money due to relying too heavily upon the leverage on offer, so new traders are advised to plan their progress in the market with care.
The forex market is also only influenced by macro events which means that information based movements aren't as profitable as they might be on the other markets. It isn't affected so much by the micro events such as a major role being vacated within a firm. Many feel this is an advantage due to the less uncertainty it brings. It also makes it the hardest market to manipulate.
Overall, this video creates a ground base of knowledge of the Forex market. It is a great step up and goes a long way to helping new and experienced traders become familiar with not only what foreign exchange does but how it works. The highlighting of the advantages and disadvantages ensures it is a neutral piece with no ulterior motive. Just sit back and enjoy being taught about the largest, most exciting market in the world.