Many people have asked me why I trade the Forex market exclusively and nothing else.
Here are my top 5 reasons for doing so and why they are unmatched by other trading instruments like Stock, Options, or Crypto.
1) High Daily Trade Volume
The Forex (FX) market is the largest market in the world. Daily trade volume reached $6.6 trillion per day in April 2019, up from $5.1 trillion three years earlier, according to the 2019 BIS Triennial Central Bank Survey.
This sheer volume dwarfs the trade volume of all the world’s stock markets combined, which average roughly $200 billion per day. Unlike stocks, nobody can own the market nor can anyone control the market per se.
High daily trade volume means high liquidity. This means all our market orders to enter and exit the market at the price we want is instantaneous. No waiting, no price gaps, and no requotes, etc. High trade volume and liquidity also lead to tighter spreads and lower transaction costs on a per-trade basis for our clients.
Unlike a business owner or a stock trader/investor where you are required to make yourself a guarantor in addition to collateralizing your assets for the leverage (a.k.a. margin) needed.
In the Forex trading universe, this leverage is given free by the licensed FX Broker that we work with. No need for you to be a guarantor and no collateral is needed from you. However, leverage is a two-edged sword. It magnifies your returns when you are right and losses when you are wrong.
This is the single reason why we utilize our four dimensional approach - multiple algorithms, multiple currency pairs, multiple hedged positions, and multiple time frames - in all our trading activities to mitigate our trading risk and to put the odds on our side.
3) 24-Hour Market
The Forex market never sleeps. It is open 24 hours a day, 5 days a week. Forex trading is facilitated through the interbank market across 1300 banks all around the world and not over a traditional exchange. As such, there is no waiting for the opening bell of an exchange or scrambling to get your order executed before its close.
This is where our suite of automated trading algorithms makes the most sense as compared to active manual trading by human traders. Algorithmic trading will not make mistakes or get fatigue like human traders do.
4) Forex Market is Cyclical
Unlike other trading instruments, Forex trading is traded in pairs between two currencies, and because no one currency can appreciate or depreciate against the other forever, thus the Forex market will always move cyclically and revert to a mean after some time.
The knowledge of mean reversion has been our competitive advantage in building and designing our trading algorithms and it has helped us delivered consistent and stable returns to ourselves and our clients.
5) Narrow Focus
Analyzing a stock that will make you money among the thousands is like looking for a needle in a haystack. It is exceedingly difficult even for the most astute trader or investor. They get it wrong most of the time even with all the information at hand.
On the other hand, Forex trading is a lot simpler and focus. There are only 8 (Eight) major pairs of currency that are most traded daily. And out of these 8 (Eight) major pairs, we trade only 5 (Five), namely, EURGBP, EURUSD, GBPUSD, USDCAD, and USDCHF exclusively. We have selected these 5 (Five) pairs because they compliment one another and thus increases our odds of success even further.
"If you don't find a way to make money while you sleep, you will work until you die."
- Warren Buffett
NOTICE TO VISITORS
ALGOINSIGHTS PTE LTD (UEN: 201928835M) is the Software as a Service (SaaS) Master Licensor of our proprietary Forex trading algorithms to our licensees locally and globally.
ALGOINSIGHTS PTE LTD is not licensed, approved, registered or otherwise regulated by the Monetary Authority of Singapore (MAS) or any other applicable regulator in Singapore or otherwise in respect of any of its activities, nor does it hold itself out as being so licensed, approved, registered or otherwise regulated.
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