Identifying The Different Types Of Forex Investors

There are different styles and types of forex investors that exist in the forex market. Forex investors use the forex market to build their investment portfolio so that they can see a long term profit that takes place over a long period of time.


Someone who is just using the forex market to make money quickly for a short period of time is called a "trader". Members of an investment group fall into the first category: they are in the investment market for the long haul.

There are different types of forex investors that use different methods to analyze the market and the market conditions.


The three methods that forex investors use for analyzing the market are:

· Technical analysis. This method of analysis is used by "momentum" forex investors. Technical analysis looks at the price fluctuations that occur in the forex market. The forex investors base their decisions to buy or sell on what he feels the price will do next.

· Fundamental analysis #1. Fundamental analysis is used by "growth" forex investors. This type of analysis decides if a certain company is a good investment based on the earnings of the company, growth sales, and margins of profit.

· Fundamental analysis #2. "value" forex investors use this type of analysis. This method of analysis is similar to the analysis that growth forex investors use, but is slightly different. Value forex investors takes a close look at those companies in the forex market that have a low value.


The forex investors look at forexs that are currently cheap and low but that have the potential to make a good comeback.


Most investment clubs use the fundamental method of analysis to make most of their investing decisions. They find companies that are listed on the forex market that show good growth, profit, and earnings but that are still cheap to buy and haven’t yet reached their potential.


Members of the investment club buy this forex and hold on to it for several years so long as the fundamentals, as listed previously, continue to hold strong. This type of investment strategy is called "buy and hold".