Increased Leverage
The Forex market allows you to control $100,000 with as little as
$1,000. This means that you can make your money work harder for
you in the Forex market than it can anywhere else. Imagine. You
can keep all the profits from a $100,000 trade, and all you have to
do is provide 1 percent of the money.
To put this in perspective, imagine that you are a real estate
investor, and you see a $300,000 home that you believe is going to
increase in value. If you could use the same amount of leverage in
the real estate market as you can in the Forex market, you could
buy that house with only $3,000 down and a potentially interestfree
loan. That would be incredible. Any real estate investor in the
country would do anything to get that kind of a deal, and that is
exactly the opportunity you have in the Forex market.
Increased leverage is also the point that well-intentioned, but
misinformed people point to when they say that investing in the
Forex market is risky. Granted, this amount of leverage may seem
aggressive, but the Forex market gives you the perfect antidote for
the risks associated with increased leverage: guaranteed stops.
Tuesday, November 24, 2009
No Commissions
No Commissions
Every time you buy a stock, a bond, a mutual fund, or a home, you
are paying someone somewhere a commission. In the Forex market,
however, you never have to pay a commission. The price you see is
the price you get. You don’t have to factor in a little extra for the
broker. You simply pay the listed price. No more, no less.
Every time you buy a stock, a bond, a mutual fund, or a home, you
are paying someone somewhere a commission. In the Forex market,
however, you never have to pay a commission. The price you see is
the price you get. You don’t have to factor in a little extra for the
broker. You simply pay the listed price. No more, no less.
Trading Hours
The Forex market is open 24 hours a day nearly 51⁄2 days a week.
It doesn’t matter if you’re working or retired, a homemaker or a
student, you can find a time that works for you to get involved in
the Forex market. In fact, the Forex market is usually most active
early in the morning and late and night. There are many part-time
traders who are able to use these varied hours of market activity to
their advantage by trading when they are not at work. The varied
trading hours of the Forex market also benefit long-term investors
because these investors are able to enter and exit their positions
whenever the market dictates.
It doesn’t matter if you’re working or retired, a homemaker or a
student, you can find a time that works for you to get involved in
the Forex market. In fact, the Forex market is usually most active
early in the morning and late and night. There are many part-time
traders who are able to use these varied hours of market activity to
their advantage by trading when they are not at work. The varied
trading hours of the Forex market also benefit long-term investors
because these investors are able to enter and exit their positions
whenever the market dictates.
Tax Advantages of the Forex Marke
Tax Advantages of the Forex Market We all want to keep
as much of our profit as we possibly can, and the Forex market allows
us to do that. Even though you entered and exited your trade in the
Forex market within six months—just as you did for your stock
trade—only a portion (40 percent) of your profits is taxed as shortterm
capital gains. The remaining 60 percent of your profits get the
benefit of being taxed as long-term capital gains. This means that
you will have to pay 33 percent on only $4,000 and—according to
current long-term capital gains rates—15 percent on $6,000.
Portion Taxed as Short-Term Capital Gains
$10,000 40% = $4,000
$4,000 33% = $1,320
Portion Taxed as Long-Term Capital Gains
$10,000 60% = $6,000
$6,000 15% = $900
Total Taxes Paid
$1,320 + $900 = $2,220
You would have to pay only $2,220 with your Forex trade compared
to the $3,300 you would have to pay with your stock trade.
That is a savings of slightly more than 35 percent. Tax savings like
that can add up quickly.
You can also accumulate profits quickly by investing in the
Forex market within your IRA or other tax-deferred retirement
account. Many investors are unaware they can trade anything but
stocks and mutual funds within their retirement accounts because
their brokers have conditioned them to focus only on these asset
categories. Some brokers don’t want to deal with the extra work
that would come from allowing you to invest more freely. It isn’t
advantageous for them. On the other hand, other brokers believe
that you should be able to choose where you put your money.
Check with your brokerage firm and see if it offers self-directed
options in its retirement accounts.
as much of our profit as we possibly can, and the Forex market allows
us to do that. Even though you entered and exited your trade in the
Forex market within six months—just as you did for your stock
trade—only a portion (40 percent) of your profits is taxed as shortterm
capital gains. The remaining 60 percent of your profits get the
benefit of being taxed as long-term capital gains. This means that
you will have to pay 33 percent on only $4,000 and—according to
current long-term capital gains rates—15 percent on $6,000.
Portion Taxed as Short-Term Capital Gains
$10,000 40% = $4,000
$4,000 33% = $1,320
Portion Taxed as Long-Term Capital Gains
$10,000 60% = $6,000
$6,000 15% = $900
Total Taxes Paid
$1,320 + $900 = $2,220
You would have to pay only $2,220 with your Forex trade compared
to the $3,300 you would have to pay with your stock trade.
That is a savings of slightly more than 35 percent. Tax savings like
that can add up quickly.
You can also accumulate profits quickly by investing in the
Forex market within your IRA or other tax-deferred retirement
account. Many investors are unaware they can trade anything but
stocks and mutual funds within their retirement accounts because
their brokers have conditioned them to focus only on these asset
categories. Some brokers don’t want to deal with the extra work
that would come from allowing you to invest more freely. It isn’t
advantageous for them. On the other hand, other brokers believe
that you should be able to choose where you put your money.
Check with your brokerage firm and see if it offers self-directed
options in its retirement accounts.
Tax Treatment of the Stock Market
Tax Treatment of the Stock Market Since you entered and
exited your trade in the stock market within six months, you will
have to pay short-term capital gains tax. If you are in the 33 percent
tax bracket, you will have to pay 33 percent tax on of the profits. So
for a profit of $10,000, you will end up paying $3,300 in taxes.
Profiting with Forex 5
$10,000 33% = $3,300
While you did get to keep $6,700 of the original $10,000 profit,
it is never fun to pay taxes.
Tax Advantages of the Forex Market We all want to keep
as much of our profit as we possibly can, and the Forex market allows
us to do that. Even though you entered and exited your trade in the
Forex market within six months—just as you did for your stock
trade—only a portion (40 percent) of your profits is taxed as shortterm
capital gains. The remaining 60 percent of your profits get the
benefit of being taxed as long-term capital gains. This means that
you will have to pay 33 percent on only $4,000 and—according to
current long-term capital gains rates—15 percent on $6,000.
Portion Taxed as Short-Term Capital Gains
$10,000 40% = $4,000
$4,000 33% = $1,320
Portion Taxed as Long-Term Capital Gains
$10,000 60% = $6,000
$6,000 15% = $900
Total Taxes Paid
$1,320 + $900 = $2,220
You would have to pay only $2,220 with your Forex trade compared
to the $3,300 you would have to pay with your stock trade.
That is a savings of slightly more than 35 percent. Tax savings like
that can add up quickly.
You can also accumulate profits quickly by investing in the
Forex market within your IRA or other tax-deferred retirement
account. Many investors are unaware they can trade anything but
stocks and mutual funds within their retirement accounts because
their brokers have conditioned them to focus only on these asset
categories. Some brokers don’t want to deal with the extra work
that would come from allowing you to invest more freely. It isn’t
advantageous for them. On the other hand, other brokers believe
that you should be able to choose where you put your money.
Check with your brokerage firm and see if it offers self-directed
options in its retirement accounts.
exited your trade in the stock market within six months, you will
have to pay short-term capital gains tax. If you are in the 33 percent
tax bracket, you will have to pay 33 percent tax on of the profits. So
for a profit of $10,000, you will end up paying $3,300 in taxes.
Profiting with Forex 5
$10,000 33% = $3,300
While you did get to keep $6,700 of the original $10,000 profit,
it is never fun to pay taxes.
Tax Advantages of the Forex Market We all want to keep
as much of our profit as we possibly can, and the Forex market allows
us to do that. Even though you entered and exited your trade in the
Forex market within six months—just as you did for your stock
trade—only a portion (40 percent) of your profits is taxed as shortterm
capital gains. The remaining 60 percent of your profits get the
benefit of being taxed as long-term capital gains. This means that
you will have to pay 33 percent on only $4,000 and—according to
current long-term capital gains rates—15 percent on $6,000.
Portion Taxed as Short-Term Capital Gains
$10,000 40% = $4,000
$4,000 33% = $1,320
Portion Taxed as Long-Term Capital Gains
$10,000 60% = $6,000
$6,000 15% = $900
Total Taxes Paid
$1,320 + $900 = $2,220
You would have to pay only $2,220 with your Forex trade compared
to the $3,300 you would have to pay with your stock trade.
That is a savings of slightly more than 35 percent. Tax savings like
that can add up quickly.
You can also accumulate profits quickly by investing in the
Forex market within your IRA or other tax-deferred retirement
account. Many investors are unaware they can trade anything but
stocks and mutual funds within their retirement accounts because
their brokers have conditioned them to focus only on these asset
categories. Some brokers don’t want to deal with the extra work
that would come from allowing you to invest more freely. It isn’t
advantageous for them. On the other hand, other brokers believe
that you should be able to choose where you put your money.
Check with your brokerage firm and see if it offers self-directed
options in its retirement accounts.
Ease of Entry
You do not have to be rich to trade in the Forex market. Everybody
deserves to be able to protect his or her financial future, and the
Forex market makes this possible by offering an extremely low
barrier to entry. In fact, you can open a Forex account with as little
as $300.
Profit Potential
It doesn’t matter if the value of the U.S. dollar is going up or down.
You can make money in the Forex market. If you think its value is
going up, you simply buy the U.S. dollar and make money all the
way up. If you think its value is going down, you simply sell the U.S.
dollar and make money all the way down.
Tax Advantages
When you invest in most financial markets, you must pay short-term
capital gains tax if you take your profits within one year of purchasing
a security. If you hold the security for more than one year
before taking your profits, you must pay long-term capital gains tax.
Currently, short-term capital gains are taxed at your current tax rate,
and long-term capital gains are taxed at only 15 percent. Obviously,
it is much better to pay less in taxes. In the Forex market—much to
investors’ delight—it doesn’t matter if you take your profits one
minute after you enter a trade or one month after you enter a trade.
Sixty percent of your profits are taxed at long-term capital gains
rates, while only 40 percent of your profits are taxed at short-term
capital gains rates. That means you keep more of your profits in
your pockets.
For example, imagine you made $10,000 on a six-month trade
in the stock market and that you also made $10,000 on a six-month
trade in the Forex market. Both trades occurred in taxable accounts,
so you owe taxes on both. Assume you are in the 33 percent tax
bracket.
deserves to be able to protect his or her financial future, and the
Forex market makes this possible by offering an extremely low
barrier to entry. In fact, you can open a Forex account with as little
as $300.
Profit Potential
It doesn’t matter if the value of the U.S. dollar is going up or down.
You can make money in the Forex market. If you think its value is
going up, you simply buy the U.S. dollar and make money all the
way up. If you think its value is going down, you simply sell the U.S.
dollar and make money all the way down.
Tax Advantages
When you invest in most financial markets, you must pay short-term
capital gains tax if you take your profits within one year of purchasing
a security. If you hold the security for more than one year
before taking your profits, you must pay long-term capital gains tax.
Currently, short-term capital gains are taxed at your current tax rate,
and long-term capital gains are taxed at only 15 percent. Obviously,
it is much better to pay less in taxes. In the Forex market—much to
investors’ delight—it doesn’t matter if you take your profits one
minute after you enter a trade or one month after you enter a trade.
Sixty percent of your profits are taxed at long-term capital gains
rates, while only 40 percent of your profits are taxed at short-term
capital gains rates. That means you keep more of your profits in
your pockets.
For example, imagine you made $10,000 on a six-month trade
in the stock market and that you also made $10,000 on a six-month
trade in the Forex market. Both trades occurred in taxable accounts,
so you owe taxes on both. Assume you are in the 33 percent tax
bracket.
Market Size
The Forex market is the largest financial market in the world. (See
Figure 1.1.) Nearly $2 trillion change hands every day. To give you
an idea of what an awesome number that is, the New York Stock
Exchange experienced record volume during the third quarter of
1998 and cleared only $1.9 trillion in volume—60 times less than the
Forex market clears in a quarter. Being the largest financial market
in the world is advantageous; it makes buying and selling currencies
extremely easy because there are so many buyers and sellers out
there. Imagine that you are trying to sell your home, and you had
thousands of people standing at your front door—cash in hand—
ready to buy the house. It wouldn’t be too tough to sell the house.
The second advantage of the size of the Forex market is that
investors are unable to manipulate it. Since potential manipulation
is virtually nonexistent, you can be confident that the prices you
are getting in the Forex market are fair prices.
Figure 1.1.) Nearly $2 trillion change hands every day. To give you
an idea of what an awesome number that is, the New York Stock
Exchange experienced record volume during the third quarter of
1998 and cleared only $1.9 trillion in volume—60 times less than the
Forex market clears in a quarter. Being the largest financial market
in the world is advantageous; it makes buying and selling currencies
extremely easy because there are so many buyers and sellers out
there. Imagine that you are trying to sell your home, and you had
thousands of people standing at your front door—cash in hand—
ready to buy the house. It wouldn’t be too tough to sell the house.
The second advantage of the size of the Forex market is that
investors are unable to manipulate it. Since potential manipulation
is virtually nonexistent, you can be confident that the prices you
are getting in the Forex market are fair prices.
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