Benefits of Forex Trading Compared to the Stock Market

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Advantages of Forex trading compared to the stock market. Find out why it is more profitable and easier to trade on forex than on the stock exchange.

Forex is becoming more and more popular day by day. In addition, he manages to lure traders from traditional stock markets in various areas. If you are interested in trading in the stock markets, you just need to know about the benefits of trading in FOREX.

Benefits of trading on the independent FOREX market

Everyone who has ever participated in Forex trading knows that it has a huge number of positive qualities.

Initially, it is worth noting that financial barriers are much lower here. To be more precise, the stock market requires an account of at least 1000000$. Agree, not every ordinary person has an amount with six zeros, even the same rubles, not to mention dollars.

In turn, futures markets require initial capital in the amount of several thousand dollars.

  • If we talk about Forex, then there is an opportunity to trade mini-lots. At the same time, your account must have at least 2 thousand dollars. The maximum deal size is $1 million.
  • In the event that you are just starting your Forex activity, then your mini-lot can be only a couple of dollars.
  • Replenishment of accounts is carried out using electronic wallets. That is, there is no need to regularly visit banks in order to replenish your account. It is also possible to replenish using cards.
  • Absolutely anyone can get the potential to trade, while he can have a minimum amount of funds on his account.
  • 24/7 trading opportunity. Forex keeps in touch with traders 24 hours a day, unlike stock markets. This plays a big role especially for those who use the independent market as a way to earn extra money.
  • Free software and quotes. For example, futures markets require traders to pay for both the system software and the platform on which they operate.
  • Forex does not require commission funds. You will only have to pay for the spread (entry to the market).

Forex Disadvantages

Despite the huge number of positive qualities, Forex has some negative qualities.

  • The main disadvantage of an independent market is the absence of some DCs of control and regulation. To be more precise, some companies do not have clearing centers.

Quite often, a client, that is, you, can become a victim of a broker. Often brokers do not work for the benefit of the client, but for their own pocket. They can lower and raise prices artificially, so to speak.

Therefore, you need to be more careful when choosing a broker, it is recommended to open an account, of course, in Alpari. After all, as you know, this broker has been paying profits to everyone without exception since 1998, has a lot of positive reviews and, moreover, is under strict regulation, unlike the others.

  • Also, the disadvantages include wide spreads. When trading with high lots, you will have to pay a spread in three steps.

This means that when bidding with a lot of 1 million dollars, you will pay about 30 dollars for entry. Of course, if you start trading with 1000$ or even 100$, then the commission will be negligible.

  • Another significant disadvantage is the presence of negative swaps.

Naturally, you can find more than one drawback of Forex, but all of them can be avoided, so to speak.

The main thing is to be attentive and responsible. If you want to make good money, you must constantly explore the market and follow it or use with this breakeven strategy.

It is also worth remembering that before trusting your finances to a broker, you need to explore all of its services that it provides.

Unfortunately, most of the risks that can be found in Forex are associated with credit funds. Their progress must be monitored several times more intensively.

You must remember that in the event of a crisis, unforeseen large surges can occur, and it is very difficult to foresee them.

But as a rule, it is during a crisis that traders earn the most. Since a very good trend begins, somewhere there is a war, and the trader raises profits.

By properly trading and monitoring your finances, it is possible to earn good money.

Some advanced traders make Forex trading their main income.

In conclusion, I would like to say that the presence of some minor disadvantages and even advantages may depend on the trader.

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