Forex Regulations in South Africa
Forex Trading is Exploding in South Africa – But Why?
Trading foreign exchange currencies is not just a lot of fun, but also has the potential to be tremendously lucrative and profitable – so long as you know what you’re getting into!
South Africa is seeing a huge uptick in Forex activity of late, leading a lot of people to wonder why South Africans are jumping headfirst into this proven investment vehicle right now.
We cover a couple of the reasons that Forex trading is exploding in South Africa below, but also go through a quick “Forex 101” kind of primer for those that are thinking about jumping into the action but haven’t started yet.
To kick things off, Forex simply stands for “foreign exchange”.
Foreign-exchange markets exist solely to buy or sell one currency in exchange for another. One of the most heavily traded investment markets in the world, the Forex market has investors that are individual citizens around the world, individual businesses, and even entire nations getting into the action.
At the end of the day, though, the foreign exchange market is basically speculators purchasing one currency they believe will go up in value compared to another. That’s the foundation of this investment.
Explaining the Popularity of Forex in South Africa Today
It’s been pretty easy to notice that South African folks became quite interested in trading as there are many blogs and what’s more noticeable – many South Africa-based YouTube channels dedicated to trading. Since the demand has been high lately, also many brokerages have started appearing. In order to take over the local market, the competition has been quite big. As all these companies are fighting over the status of the best trading platform ZA traders have ever seen, traders seem to like the ones to benefit, as these brokerages started offering various bonus promotions in order to attract more potential clients. All this rush plays a big role in boosting the already huge hype of trading. But there are plenty of backstage factors why Forex is exploding in popularity throughout South Africa right now. Here are some of the more “general consensus” theories experts are bandying about.
Pandemic Motivated Activity
The pandemic has a lot of people thinking about the world at large in ways that they haven’t in the past, specifically when it comes to currency vulnerabilities and potential opportunities around the globe.
Lots of people in South Africa have begun buying and selling different currencies across the world, practicing arbitrage in an effort to increase their own net worth, their own liquid assets, and protecting their financial futures at the same time.
Unemployment Has Spurred Forex Interest
Forex is a very “online” kind of investment opportunity, one that can be practised on a 24/7 basis, and one that requires very little barrier of entry.
All of these things make Forex ideal for folks that have lost their jobs, have moved from one career and are thinking about entering another, or are otherwise unemployed. These people have plenty of time, plenty of interest in creating money through the internet, and real motivation to walk away from their old jobs and rebuild a new life – hoping forex can help them do exactly that.
Day Trading Takes Off in South Africa
Because of the online and 24/7 nature of this investment vehicle, it is ideal for day traders.
Not everyone has the opportunity to become a full-time investor, watching as Forex markets change and shift over time. Some folks are looking to jump into Forex and then sell off as quickly as they can (often that same day) and take home the financial reward for their efforts.
There’s a lot of freedom and a lot of flexibility in Forex investing. That appeals to those that want to be able to make money outside of nontraditional working hours (or even while they sleep).
RAND’s Security and Stability Makes It Very Attractive for Forex Trading
Finally, the national currency of South Africa (RAND) has been one of the most stable and one of the most secure currencies in the world for some time now.
This helps it enjoy a fantastic value in the Forex market, setting South Africans up for success almost right out of the gate. Being able to trade on the Forex markets with a currency they are familiar with (their natural currency), one they have full trust and faith in, is a huge advantage.
Combine that with the demand on the Forex market for the RAND and it’s not hard to see why so many are getting started in this kind of investing for the first time today.