If you’re interested in learning Forex in Malaysia, this article will provide a closer look at everything you need to know about Forex trading and the advantages of doing so.
Forex trading is known to be relatively less popular among Malaysians than other mainstream asset classes like stocks, robo-advisors or unit trusts.
And in order to be a professional trader and make it profitable to you, you will first need to have the right skills or knowledge.
So continue reading!
We will give you the insights on how you can get started in trading Forex in Malaysia!
What is Forex Trading?
Forex is derived from the word “foreign exchange” which refers to a process of exchanging one currency for another.
With a trading volume of approximately 6.6 trillion USD every day in 2019, Forex trading is considered the largest financial market in the world.
This process of buying and selling currencies on this market is standard in international business and is also a popular form of investing for retail traders of all over the world.
How it works is by having a Forex trader purchase a currency at the current market price and later sell it again at a target price in the future.
As we all know, currency prices are always changing, which makes the purchase and the sale price different. Trader’s profit or loss is determined by the difference between the two prices.
5 Reasons To Start Forex Trading
Traders may have different reasons to start forex trading. To further convince you to start the process, here are some thoughts on the top benefits of forex trading:
- It’s a Large and Global Market
Forex is truly a global marketplace that offers a lot of scope for profitability. This is because traders in all corners of the world are involved in buying and selling currency pairs 24 hours of the day.
This can be seen by how this world’s largest financial market has an excess of $4 trillion USD exchanged on average per day.
It is also the breadth of the market contributing to the benefits of forex trading like accessibility, liquidity, volatility, technology and trading hours.
- It’s Beginner Friendly
One of the biggest advantages of forex trading is accessibility as it is relatively easy to start with no large initial investment required which explains its popularity among hobbyist traders.
However, regardless of your capital amount, in order to trade successfully, you’ll need to equip yourself with the right knowledge and skills.
You can start practicing trading forex risk-free by using free demo accounts that will essentially provide you a ‘try before you buy’ feature.
Demo accounts give you the opportunity to familiarise with trading platforms along with its market movements.
It also helps you to develop a risk management strategy that does not require you to make any financial commitments.
If you’re considering trading forex, be sure to take full advantage of the demo accounts first.
- Trading is Available 24 Hours a Day
One of the other main advantages of Forex trading is its rolling hours.
Foreign exchange takes place over-the-counter (OTC) which means, transactions are directly made between trading parties, and facilitated by a forex broker.
Because of this, forex trading is not restricted to the opening hours of any centralised exchange system. Deals can take place as long as there’s a market open somewhere in the world.
For instance, trading in the UK begins at 9 p.m. on Sunday with the opening of the Sydney market and rolls continuously until close of session in New York at 10 p.m. on a Friday.
To mitigate any potential risk, it’s important to note that rates will continue to move. Remember that you should factor this into your trading strategy.
- It Offers Low Transaction Costs
For entry, the Forex market requires little capital with low transaction costs once you’re in.
Brokers typically make money from spreads which are measured in pips and factored into the price of a currency pair.
Pip here stands for ‘Point in percentage’ which is the unit of measurement used to show a change in one currency’s value against another.
When you’re offered a currency pair by a broker, they’ll quote a bid (sell) price and an ask (buy) price.
The spread, the associated value of which you’ll pay the broker for facilitating the trade is indicated by the pip difference between the two.
Usually, spreads are low which makes forex trading relatively cheap.
However, be sure to look into all associated costs when choosing a broker. This is because some may charge a flat fee or variable commission.
- Forex Market Volatility
There are a number of external factors influencing the forex market, which are:
- Economic stability of a given country
- Global economy as a whole
- Political news, events and policies
- Trade deals
- Natural disasters
Because of these reasons, there can be significant movements in currency values and subsequently, the opportunity to make a substantial profit.
Even though this could be considered as one of the advantages of forex trading, it also comes with a high level of risk because the movement can occur in either direction.
In addition, volatility links strongly to liquidity. The more liquid major currency pairs tend to be less volatile.
Some major currency pairs that are subject to more volatility are Australian Dollar/US Dollar (AUD/USD) and Canadian Dollar/Japanese Yen (CAD/JPY).
You have to tailor your strategy to any potential risk if you’re looking to take advantage of the market volatility.
Learn Forex Trading With TfSolution
To get you started, join How To Trade Forex Course with TfSolution!
From zero to hero, you will be taught everything about Forex and be guided to becoming an advanced level trader.
This course is suitable to not only investors but also students or anyone interested in Forex trading. What you’ll need to join are:
- A Laptop OR PC with well functioning internet access
- Bank Account or Credit Card to fund brokerage account
- Legal identity proof to create MT4 brokerage account
For beginners, you will be introduced to Foreign Exchange Market, the basics on how to choose a Forex broker and analyzing the currency markets and technical analysis
With TfSolution, you will easily work your way up to becoming an advanced level Forex trader in no time!
Once you’ve completed the course, you will then need a minimum of three years proven record of success.
However, do note that past performance does not guarantee your future results. Never trade money you can’t afford to lose!
In conclusion, the first step of doing anything is to understand and then experience it first hand. So quick, grab this opportunity and learn how to become a professional trader with TfSolution!
TFSolution is a financial literacy online Learning Platform with an estimated USD 375 Billion industry by the year 2026. We provide educational training courses that focus on Financial Solutions.
Our vision is to be The Acclaimed Financial Literacy E-Learning Platform where our apprentices can acquire and practice their financial knowledge in the most effective and trusted manner.
TfSolution offers you an opportunity to learn the required skills to become a professional trader.