In the last few months, the coronavirus has spread around the world. And somehow this has led to an increase in the African Forex market. According to statistics, the FX market is growing daily. Traders are discovering more and more opportunities in this area.
In this article, we will explore how Forex trading is changing Africa. Forex trading is an ideal platform for investors to earn extra income from the comfort of their home. Read on to find out more.
Why is Forex trading changing Africa?
Over the past six months, many traders have started trying their luck in the Forex industry. And it is changing the African economy for the better. Since many investors are unable to continue their business due to the pandemic, they are trying their luck in the FX industry.
1. The forex market is huge
Although there are many financial markets, the Forex market is the largest. It is interesting to note that more than 5 trillion occurs every day. Dollar transactions. In contrast, none of the other markets is close to this figure. So, this is one of the reasons why the Forex trading market is expanding across the country.
2. Lower transaction costs and more liquidity
Because there are so many operations on a daily basis, the FX market is very liquid. This is the reason why operations are performed in seconds, which reduces the cost of the operation. If the market were less liquid, people would pay higher fees for each transaction.
In Africa, people are taking advantage of reduced transaction costs to enter the FX market.
3. Currencies are strengthening
Although the coronavir is spreading around the world, many other factors affect currency prices. Covid-19 has had a negative impact on the economies of many countries. And Africa is no exception. Many African currencies have weakened against other currencies.
Now that the business is opening up gradually, many currencies are strengthening relative to other world currencies, the FX market is expanding more and more in Africa. This is the reason why the FX market is seeing more and more traders and brokers.
The good thing about the Forex market is that it is easy to achieve with the help of a Forex broker. In addition, currencies are traded around the clock, regardless of the time zone of traders. Traders in Africa can enter this market whenever they want. Also, FX trading does not require traders to stand in front of their computers at all times. In fact, they have the freedom to conduct operations from anywhere, as long as they are connected to the Internet.
5. Currency trading may take place at any time
Due to the ongoing pandemic, many people spend all their time in their homes. Therefore, they can join Forex trading as a full time job. With this opportunity, they can learn, explore, and apply a variety of strategies to succeed.
6. Diversity of forex brokers
Another reason why Forex trading is changing Africa is that Forex traders can choose from many brokers. In addition, traders can open accounts without investing money. Based on their experience and knowledge, they can choose to work with the right broker.
7. It does not require large capital
In Africa, traders can start trading in the Forex world without spending a lot of capital. Leverage can be used to open large positions regardless of the initial deposit or balance in the trading account. However, leverage should be used properly as it can cause a lot of financial loss.
8. Hedging option
Hedging allows traders to limit the money they can lose over a period of time. The idea is to invest a lot in opposite price ratios. The goal is to make a lot of profit by locking in the exchange rate after opening our trade.
9. Secure assets
Due to the often changing price changes, many African traders feel a little overwhelmed when it comes to trading Forex. This is the reason why many traders invest in safe assets. If you are unsure, many currencies such as CHF and JPY can be included in this asset. The good thing about these assets is that their price changes are less volatile.
10. Any person can be a currency trader
In Africa, anyone can start trading in the Forex world because they don’t have to spend a lot of money. They can use a variety of educational resources, seminars, lessons, and guides to get started and be safe.
In addition, FX trading is more affordable because traders can use many devices, such as cell phones, laptops, tablets, and desktops, to conduct their trading. This freedom allows many people to start working in this business because they can make transactions from anywhere, even on the go.
11. Endless possibilities
In Africa, traders can enjoy many opportunities in the world of Forex market. For example, they can choose from a wide range of strategies, currencies, trading platforms and brokers. Endless possibilities are another major reason why Forex trading is changing Africa rapidly.