So, are you searching a good and responsive article which clearly teach you the differences between Forex Trading & Stock Trading ? OR, you become frustrated by trading in stock market and want to favor your luck on Currency Market ? However, you are in right place now. Actually, here we like to demonstrate the clear distinction between Forex Market and Stock Market. At first , you have to know, what is Forex and What is Stock . Below we write a simple definition of both. Read carefully .
What Is Forex Trading ?
The Foreign Exchange Market (shortcut -Fx) is a global decentralized market for the trading of currencies .This includes all aspects of buying ,selling and exchanging currencies at current or determined prices. In term of volume trading, it is the largest market in the World. The Forex market is unique because ….
- Its huge trading volume
- its geographical desperation
- Its continues operation (24*5) .Only Saturday & Sunday weekend .
- The variety of factors that affects exchange rates like Global economic news, Fundamental news etc.
- The lower margin of relative profits
- The use of leverage to enhance trading profit.
(Article credit to – Wikipedia )
Actually in short , Forex trading means currency trading like EURUSD, EURJPY, GBPUSD, AUDUSD etc.
What is Stock Trading ?
Stock Trading is far less than Forex. Actually, a Stock Trader or a Equity Trader or Share Trader is a person or company involved in trading equity securities .A Stock investor is an individual or company who puts money to use by the purchase of equity securities . Hopefully you know some biggest stock market like Dow Jones, NASDAQ, CAC. FTSE, , DAX, SENSEX, NIFTY50 etc.
Differences Between Forex & Stock Trading
Most Stock Market operate for 8 hours and close until for next trading day morning .For example, Indian Stock Market (Nifty50 & Sensex) open on 9.15 A.M and close on 3.30 P.M . On the other hand, there is no downtime in Forex Market. It’s a unlimited market opening for 24*5 a week (only Saturday & Sunday is weekend ).
2. Financial Friction :
The Stock Market always require a middleman. Every time ,a stock is bought or sold, a middleman, may be a broker or some other entity ,is always standing between buyer & seller. The broker take brokerage just to facilitate the trade. But ,on the other side, in Forex Market, a trader can buy or sell directly by spot trading. Although, there are also Forex Broker (like Instaforex) . But the edge is, in Forex Market ,the Spread are transparent. More over, most broker does the collect any addition fees (like Deposit Fees, Trading Fees, Withdraw Fees etc.