If Forex is so lucrative then why many people are not interested in this?

[cyberkrish]

Hi,
I am tradin gfor the past few weeks and iam learning that this business is lucrative.But why many people are not into this and people say that there is a very good future for Forex.Can anyone explain why people are tradin gstocks more than forex?IS there any reason?
I welcome your answers and i would appreciate it.
cyberkrish

[smiley33]

hello cyberkrish,

Glad you have found that FX is lucrative - it is not the same for all of us , especially when new!

I always wondered why the equity market is more appealing to the retail investor. What with all the scandals of recent, not to mention the money lost on equities, you are correct to wonder.

The only reason I could find is people's perception that it is a 'dangerous game' (like anything that involves risk/reward ratio) and that they cannot blindly by a copy of the financial press hoping that in 2 years time they will be sitting on a tidy profit.

Having said that, FI's are in this game day and night , and are using their client's funds to transact FX & MM. They should know something, and that something MUST be making them money.

In terms of volume, you would be mistaken to say that more people are trading equities - it is merely our perception.

Welcome and wishing you a very profitable day,

smiley33

[buff]

May I suggest it has something to do with lack of understanding or not even knowing that currency trading is available to the masses. When I tell people what I do, they just stare at me blankly with a really dumb look, having no idea what I am talking about. Shares (stocks) have been around for the last couple of centuries where anyone with the get up and go, could easily trade them. They are spoken about at length in all the major financial media, and normally relate to real companies that the average Joe on the street can relate to. The only thing people know about currencies, is if they are planning a holiday overseas, then they start working out the conversion rate from their own currency to the visiting country's. The same could be said to a lesser extent about futures, options, warrants, CFDs etc. It's the old comfort zone thing...just my opinion.

[cyberkrish]

Hi Buff&Smiley33,
It is nice to read your views about FX market.When i told my friends even they couldnt understand and as buff said they were confused.Since there is opportunity for me to venture into FX in a big way i wanted what exactly people tell about FX.Anyway its nice of you to reply and i have rewarded you ...of course its my duty.
Thanks!
Happy Trading!
cyberkrish

[Johnny]

Hi Cyberkrish.

I am new to forex as well. And the reason I believe most investors shy away from the forex is...

1) misconceptions. Most believe it is a "fools game" with so much volatility that they'll lose their shirts in a day kind-of-thing.

2) new. The retail forex business for small investors is having only it's eighth birthday this year. A lot of people just don't know about it.

3) fear. Of the unknown.

4) effort. Most people do not wish to exert the effort it takes to learn something new.

Just my opinion.

[biggpipin]

i have pondered this very question. after nights of ruminating, i have concluded that it is because forex is a newer market, and we (forex traders) are the early adaptors. the early majority are sure to follow.

[cyberkrish]

Hi Johnny&Bigginpin,
I completely agree with you people about the forex market which is new and as Johnny said it is just 8 years old and not many people are aware of it.How did you come to know that forex is just 8 years old?Any proof ?I just want to see it myself.Thanks for taking the time to reply.
cyberkrish

[jove]

I have been in this market for the last 3 weeks trading mostly EUR/USD. I was testing the market with OANDA. My maximum buy or sell was 5000 EUROs. I did almost double my $1000.- investment within three weeks.

The market is mostly driven and controlled by few key people who issue statements from time to time and by those who echo them on Bloomberg and other broadcasting services. The Forex market is a subdued 500 pound Guerella. It can be shaken and turned upside down by a single person with just a few words.

You actually know the trend most of the time. Just follow the herd. But, directions are changed in the middle of the game without notice. You, as an individual trader will be the last one to get the news. It was only an hour ago when your were told about the EUR/USD hitting 1.35 with no interruptions. The same analyst comes out on Bloomberg to give you the reasons why the EUR/USD has reversed direction and why it is going to hit 1.15.

You can make tons of money day trading this market. You know the direction of the trend. You only have to figure out when to enter and when to get out. Exit while they are preparing the next wave of news and you will be ok.