Extended data:
24-hour transaction
Foreign exchange trading is a real 24-hour all-day trading market. Every day, the New Zealand stock market opens first, followed by Sydney, Tokyo, London and new york. Investors can participate in trading at any time from Monday morning to Saturday morning; Even if the market fluctuates due to economic, political and social events, the investment risk caused by the price difference between closing and opening may be relatively reduced.
High market transparency
Investors in foreign exchange trading are distributed all over the world, and the market is difficult to be manipulated. In addition, there are many factors that affect the foreign exchange market, including interest rates set by the local national central bank, stock market, economic environment and data, policy decisions, various political factors and even major events, which are beyond the control of a single investor or group.
High liquidity of funds
The foreign exchange market is one of the largest financial markets in the world economy. Market participants include banks, commercial institutions, central banks, investment banks, hedge funds, governments, currency issuers, note-issuing banks, multinational organizations and retail investors. Therefore, the liquidity of the foreign exchange market is extremely high, and investors do not have to bear the investment risks caused by the lack of trading opportunities.
stimulation
This is the theme of foreign exchange market in 2005. If a country's interest rate is relatively higher than other countries, it will stimulate the inflow of foreign funds, thus improving the capital account and raising the exchange rate of its own currency. The economic development of Europe, Japan and other economies is not as strong as that of the United States, and global funds flock to the medium and long-term national debt of the United States. As a result, foreign capital keeps buying dollars and continues to support the dollar exchange rate.
According to the original theory, the difference of inflation at home and abroad is the dominant factor to determine the long-term trend of exchange rate, and the basis for judgment is called purchasing power parity. But in fact, historical data show that there is no direct negative correlation between the exchange rates of the two countries and their inflation rates. On the contrary, the central bank has a stronger decisive factor. At present, the inflation rate in the United States is 3.8%, which is higher than that in the European Union (2.3%) and Japan (0.5%). However, the Fed is worried about the adverse effects of inflation and continues to raise interest rates, which leads to the spread advantage of the US dollar, which also shows that interest rates are the most powerful driving force in the foreign exchange market at present. In terms of balance of payments, the trade deficit of the previous year became the nightmare of the US dollar. The market generally believes that the huge deficit in the current account of the United States is difficult to make up, and it is bound to need the depreciation of the dollar to alleviate it, so there was a huge dollar sell-off at that time. However, the data of American capital inflow in 20 13 years can offset the trade account deficit, and the influence of American balance of payments problem is weakened.