As a financial investor you might be looking for good options for investing in order to grow your money through the profits made on your investments. There are many ways to invest and includes stock markets, bond markets, derivatives and others but investing in Foreign currency is a great way to invest your money wisely. The currency market is the world’s largest financial market where trillions of dollars are traded on a daily basis. This gives a high liquidity to the market and any person, any firm or country can participate in the currency market for online trading.
Gone are the times when the investing in foreign currency was just a business of big financial firms, banks and other financial institutions. With the changes in the economy and increase in awareness, now any individual investor can open an account to trade in foreign currency.
Which are the best currencies for investing in foreign currency?
Let us have a look on the eight most tradable currencies of the world which every investor must know.
US Dollar- (USD) – USD is the home currency denomination of the world’s largest economy – United States of America. Dollar is supported by economic fundamentals like GDP, manufacturing and employment reports. The activities of central bank and the announcements of interest rates also affect the movement of the dollar prices. The US dollar is a benchmark for online trading against other major trading currencies, Euro, JPY and GBO especially.
Euro- This is the currency of the member countries of Eurozone and is among the topmost currencies traded in the world. European Central bank ECB is the central bank of these countries.EUR rends to be a slower currency against dollar as compared to GBP and AUD.
JPY- Japanese Yen- This is the official currency of Japan and the Bank of Japan serves as the central bank to this country which is the second largest economy in the world. On an average the daily ranges lies within 30-40 pips with extremes reaching to 150 pips for JPY. The focus time for online trading is London and US hours crossover which is 6 am to 11 am EST.
GBP- GBP is the British pound and is often referred to as the Queen’s currency. The Bank of England is the central bank of the country to which GBO belongs. GBP tends to trade a wider range throughout the day with swings that can go to 100-150 pips while sometimes it can trade narrowly to 20 pips.
Other Options For Online Trading
The other major currencies are Swiss Franc (CHF) with the central bank Swiss National Bank, Canadian Dollar (CAD) with the central bank as Bank of Canada, Australian/New Zealand dollar (AUD/NZD) with central bank Reserve bank of Australia/New Zealand and South African Rand (ZAR).
Thus the bottom-line is that the currencies offer a lot of opportunities to both the retail as well institutional investors. Due to the biggest financial market on the globe, investing in foreign currency is a great option to increase your returns on investments you make.