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EP3: Why Trade the Forex Market?
Often times, when someone asks a trader “where are you trading?” and he or she answers “I’m into forex”, the most probable follow-up question would be: “why?” or “what’s in it?” In this episode of Truth About FX, Walter talks about the pros — and cons — of trading in the forex market, the temptation of trading around the clock, and counter-productivity.
http://media.blubrry.com/truth_about_fx/content.blubrry.com/truth_about_fx/TAFX_-_EP3_Why_the_forex_market.mp3
Download (Duration: 03:29 / 4.00 MB)
In This Episode:
00:56 – trading around the clock
01:46 – the only real advantage
02:44 – transaction cost
03:13 – counter-productivity
Tweetables:
Is the forex market “better” than the stock market? [Click To Tweet].
Forex traders pay very little to trade the markets. [Click To Tweet].
Spending too much time in the chart can be very tempting but it can also result to counter-productivity. [Click To Tweet].
Announcer: Sometimes, forex trading is a wild and wooly place to be. That’s why Hugh is here, to post your questions to Walter, the naked forex guy. Hugh’s got questions and Walter’s got the answers. Here at the Truth About FX Podcast.
Hugh: Alright Walter, today’s question is: why is forex a better market to trade than other markets?
Walter: Well, that’s a good point. I’m not sure that is, to be honest with you.
Hugh: Okay, cool.
Walter: Here’s the thing – the pluses – about the forex is that it’s basically almost the 24 hour market. It’s like 20-22 hour market. You’ve got that inter-bank period when there’s nothing much going on but basically you can trade around the clock.
The bad news is, you can trade around the clock. The reason why that’s bad news as you know is that if you’ve got a job, it’s really tempting to work your job for 10 hours then come home and trade for 5 hours. It can lead you to a life of sleep deprivation. You can get cranky if you’re losing money. It’s just not really a nice way to live.
I used to do that from the Pacific time zone. It was really tough because I was trying to watch the London market. If you do that from the west coast time zone, what happens is you’re up in the middle of the night and you sleep during the days. It’s just really a tough way to do it.
In some ways, the market with the distinct open and close is better because you can be there. You know when the volumes are going to come in.
To a lesser degree, you know that in forex you’ve got three opens. You’ve got the Asian, the European and the New York open. That’s kind of nice but the only real advantage I think you have as a forex trader is typically you’re going to get better leverage than you would if you were trading stocks or futures. Typically, you can trade around the clock and you know, you’re not stuck.
If you live and work in New York, it’ll be tough for you to trade in the New York Stock Exchange if you have a job because by the time your job is over,
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By Walter Peters (FXJake) and Hugh Kimura (Trading Heroes)Often times, when someone asks a trader “where are you trading?” and he or she answers “I’m into forex”, the most probable follow-up question would be: “why?” or “what’s in it?” In this episode of Truth About FX, Walter talks about the pros — and cons — of trading in the forex market, the temptation of trading around the clock, and counter-productivity.
http://media.blubrry.com/truth_about_fx/content.blubrry.com/truth_about_fx/TAFX_-_EP3_Why_the_forex_market.mp3
Download (Duration: 03:29 / 4.00 MB)
In This Episode:
00:56 – trading around the clock
01:46 – the only real advantage
02:44 – transaction cost
03:13 – counter-productivity
Tweetables:
Is the forex market “better” than the stock market? [Click To Tweet].
Forex traders pay very little to trade the markets. [Click To Tweet].
Spending too much time in the chart can be very tempting but it can also result to counter-productivity. [Click To Tweet].
Announcer: Sometimes, forex trading is a wild and wooly place to be. That’s why Hugh is here, to post your questions to Walter, the naked forex guy. Hugh’s got questions and Walter’s got the answers. Here at the Truth About FX Podcast.
Hugh: Alright Walter, today’s question is: why is forex a better market to trade than other markets?
Walter: Well, that’s a good point. I’m not sure that is, to be honest with you.
Hugh: Okay, cool.
Walter: Here’s the thing – the pluses – about the forex is that it’s basically almost the 24 hour market. It’s like 20-22 hour market. You’ve got that inter-bank period when there’s nothing much going on but basically you can trade around the clock.
The bad news is, you can trade around the clock. The reason why that’s bad news as you know is that if you’ve got a job, it’s really tempting to work your job for 10 hours then come home and trade for 5 hours. It can lead you to a life of sleep deprivation. You can get cranky if you’re losing money. It’s just not really a nice way to live.
I used to do that from the Pacific time zone. It was really tough because I was trying to watch the London market. If you do that from the west coast time zone, what happens is you’re up in the middle of the night and you sleep during the days. It’s just really a tough way to do it.
In some ways, the market with the distinct open and close is better because you can be there. You know when the volumes are going to come in.
To a lesser degree, you know that in forex you’ve got three opens. You’ve got the Asian, the European and the New York open. That’s kind of nice but the only real advantage I think you have as a forex trader is typically you’re going to get better leverage than you would if you were trading stocks or futures. Typically, you can trade around the clock and you know, you’re not stuck.
If you live and work in New York, it’ll be tough for you to trade in the New York Stock Exchange if you have a job because by the time your job is over,