Why prefer Forex?
– An open market 24h/24 : The Forex is a market that never closes, except on weekends but the market is not closing, it is only your broker that simply not allows you to trade. Your broker offers you the possibility to trade from Sunday 23 p.m to Friday 22p.m. You can then trade at any time of the day, while returning from work for example which is impossible on the stock market. In addition, it allows you to avoid opening gaps that are very common on the stock market and can be very harmful for your investments.
– No fees on transactions : Not as brokers on the stock market, brokers on Forex do not take any fees. So how do they make money? Well, the earn money only with the spread, conversely with stock market brokers who will charge you in addition transaction fees or custody fees. According to your broker, the spread will change. You have a decision to make to choose your broker. Our section “Find your Forex Broker” will help you and give you all you need.
– Buy/Sell, whatever the side : Maybe this happened to you. You would like to short a stock but you can’t. Yes surely because on the stock market, the only way to do it in France is to use the “Deferred Settlement Service (DSS)”. But as you surely noticed, all stocks are not eligible to the DSS. You can’t short all stocks. With the Forex, this is over. Whatever the side, the pair you choose, everything is possible by a click. You decide your trading strategy and it’s not the market that lay down its rules.
– The market is not influenced : On the stock market, when a fund or a company or every big shareholder sell his stocks, the stock goes down because they have a big influence on the market. This is also true on the buy side. On the Forex, this influence just vanished. To tell you that it vanishes completely will be a lie but the influence is low. Indeed, liquidity is so high that a fund or every other big actor can’t influence truly the market. This is your job to do the market and make appear a trend!
– Analysis are not twist : A lot of analyst are working for bank. Although, companies which are rated by analysts are actually clients of those banks. So, you will understand that there is a strong link between them. The company put under pressure the bank to obtain a good rate and if not they leave their bank. The bank doesn’t want to lose its client, so she makes pressure on her analyst to force him to grant a good marking to the company. So, a false analysis is published and don’t get in the trap, this happens all the times even if it is forbidden. On the Forex, this doesn’t exist, analyst are just looking to the market, they have no interest to twist their analysis.
– An easier trading choice : On the stock market, I’m not able to tell you the number of stocks but it is really big enough. For you, this is too much possibilities of investment that makes you lose your mind and do the wrong choice. On the Forex, there are only 8 major pairs. Other possibilities are accessible but it is easier for you to make a choice according to your conviction. You can follow the evolution of all major pairs, thing impossible on the stock market.
– A market in trend : You should know that the foreign exchange market is a market conducive to strong trends. Unless an exceptional circumstance as it is the case in crisis time, it is rare to see a parity remained in a range. The investor has thus important earning opportunities.
– A significant leverage: All the brokers put at your disposal a leverage that you can use or not, starting from 1 to 500. On each transaction, you can then choose the desired leverage according to your profile, but do not forget to apply the method of money management!
– A significant liquidity : on the Forex, it is traded each day about 4000 billion dollars which will therefore provide significant liquidity and that without any care about the parity you want to trade. Moreover, given that your counterpart is your broker, you will always have the opportunity to trade on the parity you want. This high liuidity allow brokers to offers you low spreads.
– Free information : Unlike the equity market, all information is immediately available through your broker or specialist websites. You do not need a subscription to reuters or bloomberg to follow the news like this happens on stock markets
– Low initial deposit : Regardless the amount of your investment, Forex allows you to speculate on currencies and get rich due to the leverage. On the stock market, without a major account, it is very difficult to make money or live of its trading activity.