The birth of the Internet and its continued transformation has greatly impacted the forex trading industry. As a trader, understanding the specific effects of the web to your traded market is essential to positioning your trades accordingly. Below, the internet and Its impact on the forex trading industry are outlined. The information can supplement a person’s trading style and performance, regardless of his/her experience and skill level.
Access to the Exchange
A decade or more ago, retail traders could not have hoped to trade foreign currency pairs from their homes even if they had the capital or experience to do so. Now, of course, you’ll find thousands of home-based forex traders eagerly waking up every morning to participate in the chaotic and unpredictable market that is Forex.
The internet and its impact on the forex trading industry is also apparent in the ease and speed in which traders can get their accounts and start trading. It usually takes less than a week from the time you send the required documents to your broker to when you open your first trade.
Social Factor to Trading
The trading profession is a solitary one. Sure, there are trading firms that have employees of 10s or 20s cramped into an office which adds a sense of fraternization. But most trading hours of the day are consumed alone, whether you’re working for a trading firm or alone in your home.
The Internet enables traders to socialize and collaborate with other traders who share the same interests and passion for forex trading. There are several well-established forums, blogs, and message boards you can sign up for without paying a dime.
Anything and everything that goes online is free for the public to peruse, disseminate, and use to their own advantage. The Internet has given society a more transparent view of the once seemingly mystical forex market. A simple search can put a vast array of trading-related information in front of you, from trading algorithms used by hedge funds to ancient candlestick patterns started by Japanese farmers.
This increased transparency in forex trading gives more security to its participants despite the market lacking any physical exchanges. It allows regulating authorities to spot illegal broker practices and products and service scams.
These and a lot more have been effected by the Internet to the forex trading market. Studying such effects may not seem important to become a professional trader, however it may come useful later on as you work to improve all aspects of your trading business.