Investigating the perceptions of Westridge low income earners on online forex trading as a business concept.

Abstract

ABSTRACT Online foreign exchange trading has been growing internationally with the advances in technical trading robots and internet technology. The use of online foreign exchange trading as means of creating employment by novice traders was first studied in the seventies by Richard but not many studies have been conducted in South Africa. The main aim of this study was to determine if it was feasible to train low-income earning members of the Westridge community to participate in the foreign exchange market by studying the perceptions of low-income members of Westridge community on online foreign exchange trading as a business concept. The research study was conducted in South Africa at the Westridge community west of Durban. Quantitative data was collected using stratified random sampling method and a sample of one hundred participants was selected from the local stokvels. The analysis of the data collected indicated the limitations that the participants had with regards to online foreign exchange trading. Relevant academic literature indicated that online foreign exchange trading involves mathematical concepts that require participants to understand statistics. Therefore the research study recommended that the participants should have a minimum of grade twelve mathematics and English. The analysis of data collected indicated the monthly income of participants should not be less than 10 000 ZAR in order to participate in the online foreign exchange market. The research study recommended that the training should include basic understanding of financial systems; basic understanding of main pillars of the South African economy; basic statistical concepts; technical analysis of foreign exchange market; basic understanding of tax systems; and lastly how to open a company. The most pertinent finding of the research study is that the respondents were trainable in mathematical and statistical concepts that enabled them to conduct online foreign exchange trading as a business concept.