The Impact Of COVID-19 On The Popularity Of Forex Trading In SA
When the COVID-19 pandemic emerged in December 2019 at the Wuhan City of China, nobody ever thought that it would alter the normalcy of every sphere of the world. As the pandemic brought about – loss of lives, many employees were laid off from their 9 to 5 jobs.
Not only that, the economies of both developed and developing nations are in a recession like the Great Depression or even worse.
Consequently, the pandemic has forced hundreds of South Africans to seek alternative means to make ends meet. One of these means is Forex trading, a globalized decentralized market for trading currencies.
The Increase Of Forex Traders In South Africa
Thankfully, there is an increasing growth of active Forex traders in South Africa. There is currently a total number of 1.3 million Forex traders in Africa, with South Africa constituting a large percentage of the total figure.
Although it is hard to come up with the exact numbers of the South African Forex traders, it is fair to sum it up to a few hundred thousand. According to the official website of FSCA (the local financial regulator of South Africa), they have received from international brokers an unprecedented number of new applications in 2019 applying for regulation in the forex space, one of the brokers waiting for its FSCA license is also a European leading broker XTB, that yet awaits for its proper XTB regulation in South Africa.
With that said, there’s a need to pinpoint the impact of COVID-19 on the popularity of Forex trading in South Africa.
Hence, we will be looking at some of the good and bad impact of COVID-19 on the popularity of Forex trading in South Africa in these trying times.
The Good Impact Of COVID-19 On The Popularity Of Forex Trading In SA
Digitalization and the increasing expansion of e-commerce stores before and during have made “forex trading” trendy. Everybody wants to make extra money. Apart from that, South Africa is quite known as a hub of trading. Fortunately, South Africans were influenced due to the lockdown and restrictions to dabble into the forex trade. In fact, SA citizens were forced to stay home during the government’s mandatory lockdown enforced on the citizens.
The initial mindset of South Africans on trading and the lay off suffered by many employees triggered the necessity to look for other alternative income streams. Likewise, others that engaged in Forex as a hobby before the pandemic are now trading for survival.
Consequently, it’s great that people’s orientation shifts from the traditional ritual 9 to 5 jobs. People now realize they can make more money from the comfort of their homes. Also, they have more time to take care of their families and follow their passion.
Conversely, the popularity of Forex trading in South Africa also created more employment opportunities. That way, South Africans that work in corporate organizations before the pandemic now realize that they can make more legitimate money with Forex and other cryptocurrency tradings will resign.
Finally, COVID-19 has made people realize that no qualification is required before you can engage in Forex trading. You don’t have to be a tech or internet savvy either. With high-quality training, the sky is your limit.
The Bad Impact Of COVID-19 On The Popularity Of Forex Trading In SA
Unfortunately, COVID-19 has resulted in the uprising of several forex trading online scams. In fact, some South Africans lost their savings to myriads of ‘get-rich-quick’ forex investment scams and the likes.
Apart from forex trading scams, South Africans also experienced an increase in unregulated forex brokers. This made Forex trading prevalent in South Africa, while prospective traders dabbled into Forex trading with a cautious approach.
It’s no secret that “you win some and lose some” in every business. An all-time win is impracticable. With Forex trading, it could go both ways.
Hence, it’s advisable to be strategic when it comes to Forex trading.
Forex is neither Ponzi nor a make-believe scheme. Clearly, COVID-19 has been both a boon and bane on the popularity of Forex trading in South Africa. Notwithstanding, it is clear that the good outweighs the bad. Therefore, you should consider trading with regulated forex brokers and trade wisely.