Challenges of Trading Forex in Nigeria – Part 2

Previously we highlighted the technological efforts put into the Forex Industry, which has made it more accessible, flexible, comfortable, and secured. It was noted that despite these technological efforts, there are some awkward bottlenecks that makes Forex Trading quite difficult in Nigeria. 

These challenges which will be revealed later in this chapter are the unknown major cause of frustration and sudden lack of interest, which leads to failure and early departure from Forex by most participants in Nigeria. Some of these challenges are man-made, while others are caused by the effects of our environment. I’ll be dealing more on the environmental challenges.

What are these challenges? How do they affect Forex Trading in Nigeria, and how can they be resolved? 

The identification of these challenges is the first solution.

Believe it or not, doing business in Nigeria is extremely difficult despite the palliative measures put in place by the Government. There are lots of factors affecting business success in Nigeria ranging from the hurdles of registration to shop setup, rents, government rates, double taxing, operating expenses, e.t.c. It’s been observed that a high number of registered businesses in CAC (Corporate Affairs Commission) are idle, and redundant because they faded away due to harsh business challenges in Nigeria. Most people opened shops with high aspirations and now those shops are closed because of these same challenges. These same challenges hampering the positive growth of business in Nigeria is also affecting Forex Trading in Nigeria. 

I’d like to categorize the prevalent challenges of Trading Forex in Nigeria under two categories namely; 

• ENVIRONMENTAL and 
• HUMAN challenges. 

I’ll be more specific about the environmental challenges because it has more prevalent effect on Forex Trading here in Nigeria.

Read more....

ENVIRONMENTAL CHALLENGES 

This has to do with our physical environment (Climate, Beliefs, Economy, Government, Facilities, e.t.c.), and the laws that govern the environment. Every environment has its own challenge, not just Nigeria only. For example there are lots of controversies trailing the U.S Dodd- Frank Act and CFTC’s policy (http://www.cftc.gov/lawregulation/doddfrankact/dodd-frankfinalrules/index.htm), which somewhat restricts non registered brokers in the U.S. to accept U.S. citizens from opening offshore Forex Account and vice versa. Several trading policies affecting Forex Trading where reviewed by this same institutions, which didn’t go down well with most U.S Forex Traders and other non resident Forex Traders who have their accounts with brokers in USA. 

In some highly religious practicing countries, their Forex Trading Policies would definitely not be comfortable for Forex Traders who are not of the same faith or belief, and wishes to trade Forex in such regions (see sample of Islamic Trading Condition with Liquid Market). 

So every country has its environmental challenges in terms of weather, beliefs, facilities, government regulations, e.t.c. 

Nigeria’s environmental challenges with regards to Forex is very unique, and quite different from what obtains in other parts of the world. A good number of Forex Traders in Nigeria fall victim to these challenges due to ignorance. I fell for it too, and this is the reason why i put up this article to reveal these hidden challenges based on my experience in Forex in order to help other fellow traders in Nigeria prepare for and against them. 

Now what are these challenges?

Watch out for the next release:  Challenges of Trading Forex in Nigeria – Challenges Revealed

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See: Challenges of Trading Forex in Nigera - Part 1
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About Onyebuchim C. Obike I am an IT specialist in Software Programming, Networking & Telecommunication. My quest for an alternative source of income led me into Forex since 2005. My encounter in Forex over the years made me to develop a site where traders can get reliable and effective Forex Resources & Tools, that would make them successful traders. I prefer combining Technical & Fundamental techniques in trading. Follow me on facebook: www.facebook.com/fxtradecity

Challenges of Trading Forex in Nigeria - Part 1

Forex Trading simply involves the buying and selling of currencies to make gain or profits. In Nigeria it is fast expanding but a little bit uninteresting to most people.

Forex Trading is primarily carried out through an online electronic exchange handled by qualified banks and other accredited financial institutions. Initially Forex was a business meant for the super rich and huge financial institutions. This was so until retail Forex Trading evolved and enabled Forex to be delivered to the door step of every interested trader through the internet. The advent of highly improved financial technologies allowed seamless Forex transactions globally and easily with the touch of a button. 

This technological breakthrough was not limited to computers only as handheld devices now come with features that enables Forex Trading, which further enhanced remote and on-the-go Forex Trading anywhere anytime. Now you can sit right at your home in Lagos, Nigeria and place an order through your broker in London, which in turn transfers your order to the liquidity firm probably some few miles away and you get a response.
 

Lately the introduction of cloud systems into Forex has strengthened the capability of accessing forex services with minimal hardware and cost. Of course support systems are now better due to the latest cutting-edge communication systems, which is cheaper and flexible. Nearly all brokers have embraced these communication technologies in rendering support services to their clients. VPS systems, which allow hosting of Forex Account, EAs, and other Forex Services as the case may be, are being deployed increasingly by most brokers and Forex Servicing Firms.

However, despite these innovations, a larger percentage of Nigerians still experience serious challenges in trading Forex comfortably. While others who able to meet the requirements are faced with certain unavoidable challenges in our environment that makes Forex Trading uncomfortable. Unfortunately a higher percentage of Forex Traders in Nigeria who quit this business at an early stage are those who were ignorant of these challenges, and never prepared for it when they began to surface. 

However every challenge has its solution, but you must be aware of them before you can tackle them

Now the mind boggling question;  

1. Despite these innovations which has improved Online

    Forex Trading, why is it still difficult for an average 

    Nigerian to trade Forex comfortably?   

2. Why do a lot of people quit at an early stage? 

3. What’s the way out? 

Got an answer to these questions? Or do you think otherwise? The house would appreciate your comments and suggestions. 

Watch out for Part 2 of this topic: Challenges of Trading Forex in Nigeria (Challenges Revealed).

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About Onyebuchim C. Obike I am an IT specialist in Software Programming, Networking & Telecommunication. My quest for an alternative source of income led me into Forex since 2005. My encounter in Forex over the years made me to develop a site where traders can get reliable and effective Forex Resources & Tools, that would make them successful traders. I prefer combining Technical & Fundamental techniques in trading. Follow me on facebook: www.facebook.com/fxtradecity