The year 2020 is unique because it brings back the memories of the Great Recession and the Great Depression. In the past, economic downturns have marked moments of great wealth transfer from the less sophisticated to financial gurus. The first three months of the year saw global stock markets tumble to record lows and shareholders losing trillions in asset value. However, sophisticated investors who understand the value of diversification may not come off too badly wounded.
By sophisticated investors, we mean people who use alternative investment vehicles like the forex market. On various occasions, forex has proven that it is an ideal market for all seasons. During the Great Recession, people who had funds in managed accounts were able to short various forex products for huge returns. While stock market investors wept at the sight of wiped accounts, forex traders saw their bank accounts fatten. Despite all these, one still needs to ask if 2020 is right for forex trading. This is because the kind of phenomenon economies are facing is unique.
Merits of forex trading
The best way to answer the question in the title of this article is to address a few merits of forex trading first. One of the advantages of forex trading is that you are in charge of your time. A normal adult has a 9-to-5 job that pays the bills. Unfortunately, this means that the employer has control of the adult’s schedule for most of the day. Some employers may take this beyond the shift hours. On the contrary, full-time forex traders are in charge of their schedule. One can buy more free time by using forex expert advisors. These utilities take over your trading activities such that you continue to earn an income without lifting a finger.
The second merit of forex trading is access to passive income. Passive income is the money you earn without applying any effort. Can you imagine that? Much of retail forex trading is automatable. Using a forex robot, you can keep your trade positions active without glancing at the computer screen. For many traders, automated trading is the ultimate goal; it should be yours too!
Why is 2020 unique?
The coronavirus pandemic is still wreaking havoc globally through stalling economic activities. Many governments across the world have put entire populations on lockdown to avoid the spread of the monster. As such, the 9-to-5 people cannot go to work, and that means the paycheck is in limbo. Because companies cannot produce, their revenues have been hit and the value of their stock is desecrated. As such, the stock market is a no-go zone for investors.
Since COVID-19 is novel, no one has any idea how to deal with it. That is why any attempt at forecasting economic activity today is an exercise in futility. What does this mean? Huge populations of people will continue to fall out of employment. This is likely to set off the worst recession ever witnessed. The result? Investment vehicles like stock markets, commodities, and derivatives will become worthless.
Why is forex trading ideal given this situation?
Forex traders should consider themselves lucky during this crisis. In the first place, governments are encouraging people to stay at home. What do you do if you rely on the 9-to-5 job for your daily bread? If you were a forex trader, however, it does not matter what the government says. This is because you would still be able to earn good income from the market. If you were a part-time trader previously, then you have all the time to trade actively. Therefore, forex trading remains the most reasonable and tenable of all money making hacks in 2020.
Secondly, the forex market offers income opportunities whether the economy is healthy or not. During a period of strong growth, traders have the opportunity to go long. All that one needs are good forex charting tools to develop winning strategies using fundamental analysis or technical analysis. In a period of crisis, forex traders can short the various forex trading instruments. Either way, you earn a fat return.
Thirdly, the forex market is easily accessible. In this era of social distancing, no one wants to move out of the house. Whatever the case, forex traders can access the massive market from the comfort of their beds. Since the advent of online trading, a good internet connection and a mobile internet-enabled device are all that you need to participate in the market.
Fourthly, there is high volatility in the market. Since forex looks like the best financial opportunity in 2020, many people are flooding the market. This means that liquidity is even better and volatility conditions are right for any trading strategy. Traders can now deploy their FX expert advisors to take over trading activities as they play hide-and-seek with their children.
We bet that there is no market in the world where you have income opportunities in any condition. The ability to go short and long tells you that forex is a market for all seasons. During the unfolding crisis, whose end no one can tell, forex remains the ideal moneymaking opportunity. This is because one can access the market from anywhere, and volatility conditions are right for active trading. Above all, you are not going to be alone because the whole world is learning how to trade!