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Forex vs Stock
There are advantages and disadvantages to both markets. That being said, the Forex market offers traders a number of opportunities and advantages that stocks just can't compete with, and over the past several decades, large numbers of stock traders have moved to Forex Trading.
Forex is effected by two different types of events : Economy & Geopolitical Events
Stock is effected by the fate of individual companies.
Forex is a 24 hour market. Most traders think of this as a significant advantage of the Forex market. You can place type of order and then go to bed; Thus you're playing the market even while you're sleeping.
Before we describe what are the benefits of FOREX, lets remember what are Stocks. Stocks have been a popular investment for hundreds of years. Companies issue stocks to raise capital for expansion and new projects, and each share of the stock represents a partial ownership in the company. Basically speaking, when you buy stocks you invest in the company and in the market it is working in. Hence, when the company does well and makes a profit, the value of the stocks rise and you can sell your shares for a profit or hold on to the stock for even more gain in the future. Sometimes companies will issue dividends – part of the profits that are distributed to share holders, another way for you to make a profit.
Stocks are traded on Stock exchanges. Most stocks are bought and sold through brokers (agents) who charge a commission or fee for this service. American stock exchanges include the New York Stock Exchange (NYSE) and the National Association of Securities Dealers Automated Quotation System (NASDAQ). Most stocks are only listed on one exchange, although large companies may have listings on several exchanges.
Stocks were traditionally seen as long-term investments. So-called 'blue chip' stocks - those having proven value over many years - may form the backbone of an investment portfolio. Day traders attempt to take advantage of large daily fluctuations in the market by buying and selling many times in one trading period. It is relatively risky and broker commissions charged on each transaction reduce any profits realized.
Foreign Exchange Market (FOREX) is quite different from the stock
exchange. In contrast to the stock exchange, the FOREX is primarily a
short-term market. Most traders enter and exit deals within a 24-hour
period – sometimes within a few minutes. Many FOREX trades can be made in
one day without building up a large brokerage fee because FOREX trades are
commission free; hence, you keep all of your profit. Brokers earn money by
setting a spread – the difference between asking and selling prices
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