CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the risk.

Eightcap Logos_WEB.svg
Trade now

Advantages of Trading Forex

19 September 2019

The advantages of trading Forex 

Forex is the most traded financial market in the world and it is where currencies are traded. The buying and selling of currencies happen over the counter (also known as OTC), making it a decentralised marketplace. Everyone is a participant of the FX market without even realising it, from ordering a product that has to be imported or even buying currency for international travel. There are numerous reasons as to why traders are attracted to the foreign exchange market which we will explore in this article. 

24/5 Market

The FX market opens on Monday morning and trades through to Saturday without any breaks. However, it is important to note that there are different trading sessions due to time zones. This can lead to overlap and tends to be the most active period of trading the FX market sees.

Even though the FX market closes on Friday and reopens on Sunday, trading does take place on Saturday due to central banks and other organisations. It isn’t open to retail traders during this period. Due to this, there can be a variation in price from the close to the open. This is known as a gap. It is important that you are aware of FX market hours before you decide to open a position, as you may need to alter the trade accordingly. If you don’t want the position you opened to be at risk of gapping, you will need to close it on Friday. Alternatively, you could set your stop loss levels and take profit levels when making a new order on your trading platform.

Please also note that Forex trading times will differ during different months due to daylight savings, read our article on Forex Market Hours for more information.

Low-Risk Financial Market

As the forex market is highly liquid there aren’t large fluctuations in FX with movements rarely over 2% in a day compared to stocks and futures. A forex trader can customise their position size to suit their risk requirement per trade. Eightcap allows their clients to trade down to 10 cents per pip movement by simply changing the contract volume. Price movements in the forex movement can lead to high volatility providing you with an opportunity to make a profit. However, you will need to also be careful with market volatility as the market can turn against you. 

High Liquidity

As previously mentioned, the FX market is the most liquid in the world meaning there are buyers and sellers trading at the same time. Due to the liquidity the market experiences, transactions are efficient and completed almost instantly. It also normally means the spreads in the FX market are low compared to other assets. 

Trading on Leverage

Eightcap offers its clients the ability to trade with leverage according to their trading needs and experience. Currency trading can be done with CFDs which require a small initial deposit instead of paying the full value of the position up front, enabling traders to make the most out of FX price fluctuations. Beginner traders may prefer low leverage in order to manage risk.  Eightcap offers leverage from 1:1 – 1:400. It is important to note that the higher the leverage the higher the amount of risk you could face but on the flip side of this you can start trading with a much smaller amount.

When trading CFDs profits can be magnified but this also means losses could also be magnified and exceed the initial deposit. Therefore, you need to consider how to manage your risk when trading. Read our guide on the most effective risk management techniques before you open a position with us. 

Access a wide range of FX pairs

Below is an example of the variety you can open a position on:

  • Major Pairs – GBP/USD, USD/JPY, EUR/USD, AUD/USD
  • Minor Pairs –  AUD/CAD, CAD/CHF, EUR/GBP, GBP/AUD
  • Exotic PAIRS – USD/SGD

For more information about Eightcap’s trading conditions check out our spreads and account types.

Connect with us

Discord
X
TradingView
Instagram
Facebook
LinkedIn
Traders
Partners
Challenges
Embedded
Careers

Company information

Eightcap Global Limited, regulated by The Securities Commission of The Bahamas (SCB) (SIA-F220) at registered address 201 Church Street, Sandyport, Nassau, Bahamas.

Eightcap International Ltd (registration number 8427413-1) is regulated by the Seychelles Financial Services Authority (FSA SD100) at registered address Office 12, 3rd Floor, IMAD Complex, Ile Du Port, Mahe, Seychelles.

Eightcap International Trading (registration number 227050) is regulated by the Mauritian Financial Services Commission (GB25204603) with registered address Silicon Avenue, 40 Cybercity, The Cyberati Lounge, Ground Floor, The Catalyst, Ebene, Mauritius.

Important Risk Warning

Risk Warning: Margin trading involves a high level of risk, and may not be suitable for all investors. You should carefully consider your objectives, financial situation, needs and level of experience before entering into any margined transactions with Eightcap, and seek independent advice if necessary. Forex and CFDs are highly leveraged products which mean both gains and losses are magnified. You should only trade in these products if you fully understand the risks involved and can afford losses without adversely affecting your lifestyle (including the risk of losing the entirety of your initial investment). You must assess and consider them carefully before making any decision about using our products or services.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The majority of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The information on this website is general in nature and doesn't take into account your personal objectives, financial circumstances, or needs. It is not targeted at the general public of any specific country and is not intended for distribution to residents in any jurisdiction where that distribution would be unlawful or contravene regulatory requirements. Eightcap International Ltd makes reasonable efforts to provide accurate translations of the website in other languages for your convenience. Where content is missing, inaccurate or incomplete, the English version prevails.

@Eightcap 2026