It’s no secret that you can make money trading in the Forex market without incurring the same level of risk that you assume when you buy a currency on margin. This is accomplished by trading in currency related ETFs. ETFs trade just like stocks, and as such, they have many of the same legalities that stocks have. For example, you must buy an ETF through a stock broker, not over the counter as you can with currencies.

Some of the most popular ETFs that deal with the Forex market are ProShares, Barclays, and Market Vectors. You can buy an ETF that mimics the Japanese yen, the Euro, or even some of the more exotic currencies, such as emerging Asian markets. The beauty of the ETF is not in its simplicity. Currency ETFs are quite complicated, but they also are great at minimizing the risk that comes with straight Forex trading. Many Forex brokers allow customers to buy with huge amounts of margin. For example, you can sometimes trade with up to 400 times the amount that you have invested. This might get you large returns, but it can set you up for failure quite as easily. ETFs are traded just like stocks; the most that you can buy through margin is severely limited, thus giving you a cushion should your trade not go as planned.

Investing with Forex rebates in emerging market currencies is a good idea, but only if you are protected. This is why Asian and Middle Eastern currencies are so popular in the Forex market. You can get all the benefits of a quickly rising currency while staying within an acceptable range of risk.