FOREX – Implementing Modern Portfolio Theory With Currency Trading

You can poll a hundred investment advisors and market gurus and form 100 different opinions as to why markets are where they are or what they do and when they “break down. -o. ” The reason is … you can’t change what the markets do, or predict where the economy is going or change any dynamics. So as an investor you have more than two options. You can get anxious and worried and rush to the floor about it … or worse … try to “analyze it” and end up paralyzing the analysis … and nothing can be done. Or … you can find a way to profit from it.

Here I believe that Forex fits very well. You see … I view the Forex (FOReign Exchange) Currency market as a “want -vs. -Need” type of market. Here’s why. Investors may want to buy stocks … or want to buy bonds … or Real Estate or any number of “traditional” assets. But … if times are tough … or funds are tight or uncertain, then they don’t have to buy anymore … so the markets react accordingly.

Now in Forex, despite the economic conditions around the world … Europe, Asia, Canada, Australia or USA … big banks, multi-national corporations, AND countries … need to exchange their money to do their commerce. Time! And, as long as those currencies move (new value) in relation to each other there is a chance to continue price action. Now there are risks in any and all investments and there are also risks in Forex, so every investor should do their due diligence before investing, as they would in any opportunity, then decide whether it is appropriate for their investment style.

As with any investment that investors can look at, do your research, get the facts, ask questions and do your homework. I believe that once any prudent investor follows this process, that Forex will find a place in their overall investment portfolio diversification plan.