Forex Broker Instruments, is more better?

With most online businesses, offering your customers more is generally much better, as offering them a wider range of products will increase not only current customer spend, but also entice new customers looking for products to your store. This is great if you have a clothing store or a book store online, but does the same principle apply to Forex trading?

The answer is yes, but the more important question is whether it is worth it? With the majority of online Forex traders using the major currency pairs and commodities as the trading instruments of choice, it is not always worth expanding your range, unless you have the Forex dealers available to monitor the much smaller traded currencies and commodities. Because the major instruments have far more changes in their positions on a daily basis, it makes sense that most traders will use these, as they present the biggest opportunity on a daily basis to make money. With the smaller currencies, the movements are less, and it is the long term positions that make the money. However just because the majority of investment in smaller currencies is longer term, it doesn’t mean that they don’t need to be monitored, as during times of high trade, they can have the same devastating effect as the major instruments.

Currencies and commodities are not the only options you can offer your traders though. With a massive just in the OTC trading industry, many companies are including stocks in their portfolio of trading instruments too. However like currencies, they only really offer the top 100, 250 or 500 companies on an exchange. With 3129 companies listed on the New York Stock Exchange, it is no wonder that the focus is mainly on the top 500 companies.

However, just because you want to expand the range of instruments you want to offer, does not mean that you have to take the more popular instruments above it. If you find that you have a group of clients interested in trading the Vietnamese Dong again the South Korea Won, you can always offer this very unlikely pair, as you have the clients that are interested, and it is only 1 new pair that your dealers need to watch.

So in conclusion, with Forex trading, more is not always better, as the top currency pairs, commodities and stocks will generally account for around 95 – 98 percent of your business. But if you find that you have a group of traders interested in certain instruments, and the group is big enough to justify the expense in your dealing room, then add it, as the more you offer, the more you can make.

About the author:

James Weaver is DeltaQuest Group’s Marketing and E-Commerce expert. For more information about Forex Licenses and how to obtain them, please visit My Offshore Companies.