Forex trading is emerging as one of the hottest trading activities of 2021. In the year 2019 Forex market had a daily turnover of 6.6 trillion dollars which is a massive growth from $5.1 trillion in 2016. Moreover, the estimated value of the forex market in 2021 is as much as $2.409 Quadrillion. One of the most significant advantages of investing in the forex market is liquidity. The currencies that are traded in the forex markets are the legal tender money of many countries. Hence, it becomes easier to buy and sell the currency at any point in time.
There are many differences between the stock market and the Forex market. Unlike the stock market, the Forex market is open 24/7. That means you can trade in foreign currencies at any time during the day. This makes the Forex market a great option for people who are working and want to invest in assets but don’t get time during the day. In the Foreign exchange market, you also don’t need to have a large initial investment which makes it an excellent choice for beginners.
However, the low initial requirement of capital is not the only thing that makes the Forex market beginner-friendly. Another great feature of the foreign exchange market is the low fees associated with the transaction. These beginner-friendly features have attracted the attention of lots of new traders in the world. Many of these traders might only do forex trading as a hobby. If you want to trade in a Forex trading platform, the first thing you need will be an account on the Forex trading platform.
Forex trading platforms are online platforms that provide brokerage and many other services to their customers. There are many advantages of a good forex trading platform. By signing up on these platforms, you get access to trade easily with many different currency pairs in the world. If you are a beginner and want to learn first before investing, these forex trading platforms have got you covered. You can easily open a demo account and trade with many different currencies around the world. However, it is important to choose a trading platform that is secure and would not scam you in the future.
There are many ways we can choose a platform over other similar forex trading platforms. These factors can be trading analyzing the trading volume, reputation, market share, or even recommendation from some friends. One of the most common ways to evaluate a forex trading platform is through easily available online reviews. Although, online reviews are an excellent way to determine the quality of products and services. However, there are many reasons why you should not select a forex trading platform based only on online reviews.
Here are some of the reasons why you should not make your decision based on reviews:
Not many online reviews available
One of the biggest disadvantages of looking for reviews of these forex trading platforms is the lack of online reviews itself. The CMC Market, one of the most popular forex trading platform have only 45 rating and reviews on google. It gets even more interesting for some of the best brokers for forex trading like London Capital group, Saxo Capital Market, and XTB Online trading. You will find it difficult to find online reviews except for the job sites for these platforms. The lack of online reviews of these Foreign exchange trading platforms makes it easier for a small group of people to impact the rating easily. For example; if a group of 15 more people decides to give a 1-star rating to the CMC Market on Google reviews, then their average ratings will fall drastically.
Lots of beginners in the market
As we have mentioned earlier the foreign exchange market is one of the most beginner-friendly markets to trade in the world. A lot of beginners enter the market to try out their hobby. However, one must have a good fundamental knowledge of the forex market to take advantage of the price movement in the market. However, not everyone who enters the market will be able to understand and everything related to the market. It is possible that they get surprised by some unexpected charges they never knew existed. This can lead to a lot of beginners leaving the market just a few weeks after they have entered the market and still being unsure of how the forex trading platforms work. This can lead to negative reviews about the Forex platforms on the internet.
Existence of many fake reviews
You might have guessed this one. There are many negative and positive fake reviews on online review platforms like Google. Bing Liu, a professor of the University of Illinois, estimates that there are as many as 30% of fake reviews that exist on the internet. Additionally, many Forex trading platforms may provide freebies for writing fake reviews. However, these fake reviews have the potential to mislead the newbie traders who want to try out investing for the first time and don’t know much about the Forex market. Just like fake positive reviews, there can be fake negative reviews as well. It is also possible that a group of people can target a forex trading platform just to damage its image in front of its potential customers.
Forex trading platforms are growing at an amazing rate. A lot of newbie and season traders on the Forex trading platforms. Choosing the best trading platform is important. However, one should not make his/her decision based only on online reviews. Many of the online reviews on the internet are fake and can be used by a group of people to tarnish the image of a company. Additionally, the nature of the Forex market is newbie-friendly.
New investors may or may not have good knowledge about how these Forex trading platforms work. It can lead to a lot of new investors leaving negative reviews about a platform. Instead, you can make your decision based on factors like the regulatory compliance in your country, the business model of the broker, currency pairs offered by the trading platforms, etc.