In India, currency trading is permitted only via currency futures. You cannot participate in the spot market or cash market in forex. So, from the Indian perspective, let’s see if investing in currency futures is a good investment strategy.
Currency futures are traded on NSE, BSE, and MCX-SX exchanges. You can trade currencies only in pairs. Here are some pros and cons of investing in forex from India:
• Exchange rates can be highly volatile, allowing you to earn reasonable returns
• Markets respond to events and announcements made by governments around the world. The forex market is the first to react to any such event. The stock markets follow later.
• If you track global news carefully, predicting the direction of the exchange rate gets easier, allowing you to take a position accordingly.
• Since the market is volatile, losses can also be high if you take the wrong position.
• Contradicting global events can lead to confusion and nudge you into a loss-making position.
• Researching the latest happenings around the world can be time-consuming. However, failure to do so can result in erroneous trading decisions.
The forex market is the largest in terms of trading volumes around the world. It offers an opportunity to earn high returns without having to take too many risks. However, it needs you to understand events that can impact markets around the globe and cause currencies to increase or decrease in value.
If you are considering commencing forex trading, then ensure that you open an account with a platform like Motilal Oswal that offers personalized advice and a secure trading experience, among other benefits.
Currency futures are traded on NSE, BSE, and MCX-SX exchanges. You can trade currencies only in pairs. Here are some pros and cons of investing in forex from India:
• Exchange rates can be highly volatile, allowing you to earn reasonable returns
• Markets respond to events and announcements made by governments around the world. The forex market is the first to react to any such event. The stock markets follow later.
• If you track global news carefully, predicting the direction of the exchange rate gets easier, allowing you to take a position accordingly.
• Since the market is volatile, losses can also be high if you take the wrong position.
• Contradicting global events can lead to confusion and nudge you into a loss-making position.
• Researching the latest happenings around the world can be time-consuming. However, failure to do so can result in erroneous trading decisions.
The forex market is the largest in terms of trading volumes around the world. It offers an opportunity to earn high returns without having to take too many risks. However, it needs you to understand events that can impact markets around the globe and cause currencies to increase or decrease in value.
If you are considering commencing forex trading, then ensure that you open an account with a platform like Motilal Oswal that offers personalized advice and a secure trading experience, among other benefits.