As we know that these days, forex trading becomes the popular business among people. Why people do fascinate in forex trading? The answer is because such kind of trading gives you more profits and less of physical efforts. Many people also think that this business is easy to be done. Actually, there are pros and cons in this matter.
For those who agree in doing forex trading, they think that forex trading gives many merits. Such kinds of benefits are you can do transaction for all days or 24 hours. Another benefit is the liquidity. The large amounts of broker make the forex trading more stable. Hence, it can make trader open and close their position in fair market price. Moreover, the online trading requires low cost transaction. For instance, you just need to pay for drawing money from your account. You will also get some profits from the fluctuation of the prices. Traders commonly get some profits from the differences between purchase price and selling price. One the contrary, for those who disagree with forex trading thinks that it gives many demerits.
The first weakness is it provides high risks such exchange rate risk that is caused by the fluctuation of the rate of forex trading. The other risk is come from the native country. This problem is caused by the intervention of government in whose currency is traded in forextrading. For instance, there is an intervention of central bank in that country in increasing the interest rate. The forex trading sometimes also causes inflation.