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Top 7 Reasons Why Forex Trading is better than Stock Market All the glitters of dealing in stocks and commodities are waning away. These days many people prefer to trade in forex market rather than in the stock market. The most important reason for the shift is that one can make huge fortune in forex trade than in the stock markets. Sometimes trading in stock market requires the physical holding of the stocks by the trader and the sale of physical stock holdings are difficult and cumbersome also. Whereas the forex market is the world’s largest trading market because of the volume of trading done each day. By trading in a forex market for a long period of time, a trader not only gains good expertise over the trade but also can make huge fortunes.
The top 7 reasons why forex trading is better than stock market are discussed below in this article. Reason no.1: Large volume of trade: The trading volume of the forex market is far more than the stock market. That is why the forex market is considered as the world’s largest market. However, the trading in the stock market is roughly just 10% of the volume traded in the forex market. The volume of currency traded in the forex market is far more than the commodities or stocks traded in the stock market on daily basis. That is the first reason why forex market is better than stock market. Reason no.2: Less chances of manipulation: The forex market operates solely on the basis of the strength of the economy of a particular nation and not on the basis of reports issued by the corporate. It is a usual practice of the corporate to issue reports on their performances. Sometimes, these reports are also manipulated and exaggerated. The stock markets react mostly on the basis of the annual reports of the corporate. If the reports do not give an actual picture of the performance of the company, there shall be a greater impact in the trading trend at the stock markets. However, there is no such risk involved in the forex market. When there is a fall in the value of one currency, the other currency in the currency pair is certain to be on a higher side. This means you can still make a fortune even if one currency goes down. Reason no.3: Weekly closing of the trade forex markets: The stock markets close daily in the evening as compared to the forex markets. Whatever trade has to be done should be done before the closure of the market for the day. Whereas the forex market operates every day, except on Saturday and Sunday. The forex market closes once a week. So the traders can trade almost any day in the week. Reason no.4: No bull and bear influences in forex market: The stock markets are always influenced by the bullish and bearish trade. The same is not found in the forex markets. The profit potential in the forex market is high, regardless of the direction in which the market moves. There are no restrictions on the currencies you can trade. You can trade in thousands of dollars. Reason no.5: High leverage: The leverage in forex market is very high than the stock markets. Such leverage cannot be expected in the stock market while trading in commodities, stock or futures. Moreover, trading in stock requires the trader to pay commission to the stock broker for each and every trade, irrespective of the amount traded. Even you sell the stock for small amount you will have to pay commission to the broker. But this is not the case in forex market. The forex commission forms a small amount only. Reason no.6: Forex market provides more diversity of investments: Forex market offers great amount of diversity to the investors. This advantage attracts majority of investors to the forex market. Reason no.7: Can start trading with small investment: Forex trading can be started even with a small investment whereas stock trading requires relatively big investment. Conclusion: The reasons cited above in this article are just only a few. The advantages of forex trading are numerous as compared to the stock trading. But a trader needs to be careful and learn the market before he leaps.
The top 7 reasons why forex trading is better than stock market are discussed below in this article. Reason no.1: Large volume of trade: The trading volume of the forex market is far more than the stock market. That is why the forex market is considered as the world’s largest market. However, the trading in the stock market is roughly just 10% of the volume traded in the forex market. The volume of currency traded in the forex market is far more than the commodities or stocks traded in the stock market on daily basis. That is the first reason why forex market is better than stock market. Reason no.2: Less chances of manipulation: The forex market operates solely on the basis of the strength of the economy of a particular nation and not on the basis of reports issued by the corporate. It is a usual practice of the corporate to issue reports on their performances. Sometimes, these reports are also manipulated and exaggerated. The stock markets react mostly on the basis of the annual reports of the corporate. If the reports do not give an actual picture of the performance of the company, there shall be a greater impact in the trading trend at the stock markets. However, there is no such risk involved in the forex market. When there is a fall in the value of one currency, the other currency in the currency pair is certain to be on a higher side. This means you can still make a fortune even if one currency goes down. Reason no.3: Weekly closing of the trade forex markets: The stock markets close daily in the evening as compared to the forex markets. Whatever trade has to be done should be done before the closure of the market for the day. Whereas the forex market operates every day, except on Saturday and Sunday. The forex market closes once a week. So the traders can trade almost any day in the week. Reason no.4: No bull and bear influences in forex market: The stock markets are always influenced by the bullish and bearish trade. The same is not found in the forex markets. The profit potential in the forex market is high, regardless of the direction in which the market moves. There are no restrictions on the currencies you can trade. You can trade in thousands of dollars. Reason no.5: High leverage: The leverage in forex market is very high than the stock markets. Such leverage cannot be expected in the stock market while trading in commodities, stock or futures. Moreover, trading in stock requires the trader to pay commission to the stock broker for each and every trade, irrespective of the amount traded. Even you sell the stock for small amount you will have to pay commission to the broker. But this is not the case in forex market. The forex commission forms a small amount only. Reason no.6: Forex market provides more diversity of investments: Forex market offers great amount of diversity to the investors. This advantage attracts majority of investors to the forex market. Reason no.7: Can start trading with small investment: Forex trading can be started even with a small investment whereas stock trading requires relatively big investment. Conclusion: The reasons cited above in this article are just only a few. The advantages of forex trading are numerous as compared to the stock trading. But a trader needs to be careful and learn the market before he leaps.