Why Trade Forex

Automated Trading:

The Advanz Auto4X™ platform takes your TradeStation® strategy signals and automates their execution to Gain Capital’s trading platform. Advanz Auto4X™ is designed to be powerful, flexible and accurate to meet the needs of complex institutional trading departments. It is also designed to be simple and efficient for an individual trader. Advanz Auto4X™ supports the execution of any number of strategies working on any number of time frames to any or all of the Forex crosses available for trading.

Liquidity:

There are always broker/dealers willing to buy or sell currencies in the FX markets. The liquidity of this market, especially that of the major currencies, helps ensure price stability. Traders can almost always open or close a position at a fair market price.

50:1 Leverage:

50:1 leverage is commonly available from online FX dealers, which substantially exceeds the common 2:1 margin offered by equity brokers, and 15:1 in the futures market. At 50:1, traders post $2,000 margin for a $100,000 position, or 2%. While certainly not for everyone, the substantial leverage available from online currency trading firms is a powerful tool. Rather than merely loading up on risk as many people incorrectly assume, leverage is essential in the FX market. The average daily percentage move of a major currency is less than 1%, whereas a stock can easily have a 10% price move on any given day. Keep in mind that high leverage and low margin can magnify or lead to both substantial profits and losses.

Lower Transaction Costs:

It is much more cost-efficient to trade FX in terms of both commissions and transaction fees. Commissions for stock trades range from $7.95-$29.95 per trade with online discount brokers, and up to $100 or more per trade with full-service brokers. An average commission on a futures trade is $15 a round turn. Forex brokers offer much lower commission structures. Another important point to consider is the width of the bid/ask spread. In general, the width of the spread in a FX transaction is less than 1/10 that of a stock transaction, which could include a .125 (1/8) wide spread. And in the futures market, spreads are typically 7 pips or wider. As a rule of thumb, one pip equals $10, which means at 7 pips, a futures trade costs approximately $20 more than a comparable trade in the spot FX market.