Most of the investors are familiar of Stock (Equities) Market, Bonds, Options, Future Market or any other derivatives think Forex is only an alternative investment. Forex market offers high reward and passive income if you know how to deal with it. I always heard people who lose money in Forex Market shy away from it and refer FX as a high risk investment. Indeed, I agree with them because they are using high risk way to look for unreasonable return.
In FX market, some people ask me whether I use margin or not. I told them I use 'controllable margin' which I can define the risk and reward accordingly. I don't treat FX market as Casino as most of the players do, I look at it as Gold Mine. Beside risk management, I like to hedge my position once mistakes are made. With all the risk management elements in place, I will make my move and look for opportunities to strike.
Why FX is consider the most valuable asset class in my investment dictionary? Firstly, it is the most liquid asset you have. Heard of 'Cash is KING'? it is! With plenty of cash in hand, it will increase my bargaining power in any business deal. In fact, one of Warren Buffet's investment philosophy is looking at company with strong net cash flow which can offer lucrative dividend to investors. Secondly, I can shift my asset classes instantly. If I foresee certain country in trouble, I will sell their currency and buy those with strong economy fundamental. It increase my return within days. Third, by accumulating cash, I have freedom to transform it to another asset within second. I can buy anything with cash in hand. Those who own property and other asset will have trouble to sell it if they need cash urgently. I contend FX consider as the most ultimate asset class in my portfolio.
