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January 23, 2017

HotForex, What's the difference between Stock and Forex markets?

Stock and Foreign exchange markets, what are the differences? Which market you want to invest in.

Invest in Forex and Stocks together!

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After 12 years of rapid growth and becoming a truly global broker of choice with over 3.5 million live accounts opened, on May 2, 2022, HFM is entering a new era with a new name, HFM. Go to the page here to find out more about the new brand.

Do you live in South Africa? Then please go to HotForex ZA (South Africa) main introduction page.

Forex and Stock markets are different

Today we will try to clarify the question, what is the best to trade: stocks, options and futures on the stock market or currency market Forex?

First of all, let us turn to history.

The Forex market was formed in the 70th years of the 20th century.

Therefore, the obvious is the fact that Forex is much younger than the stock market.

This suggests that, the legislative base and international norms of regulating worse than stock.

In turn, this makes the stock market more robust, but the profits that you can potentially get on Forex is incomparably greater.

In this article we will not have to persuade a certain point of view, we will provide the obvious facts that will help you to form your own view, in this not easy matter.

What is Forex market?

The foreign exchange market (forex, FX, or currency market) is a global decentralized market for the trading of currencies.

The foreign exchange market determines the relative values of different currencies.

Forex is common to use the term to refer to a mutual exchange, not the totality of foreign exchange transactions.

The main features of the famous Forex market are:

  • Minimum investments for start
  • Simplicity of registration documentation.
  • Low commissions.
  • Keeping overnight trading 5 days a week.
  • Providing free leverage.
  • The possibility of obtaining profits.

What is Stock market?

A stock market is the aggregation of buyers and sellers of stocks (shares); these are securities listed on a stock exchange as well as those only traded privately.

The key word in this definition is the market.

If this market, therefore, there are vendors that offer a product and customers.

In the stock market the goods are backed securities.

That is why the stock market can be called the equity market.

So, the main distinguishing features of the stock market are:

  • Trade in real assets (gold , cocoa, metal etc.).
  • A more advanced system of international law in regard to the stock market, compared to the Forex.
  • A wide range of investment instruments (stocks, bonds, investment shares, futures and options).
  • The vast diverse and detailed analytics of the market.
  • The possibility of hedging of portfolios.
  • A wide range of assets with fixed income (bonds).
  • Ability to obtain a more stable income.

How Stocks and Forex are different in terms of Information

In Forex, important information becomes available to everyone at the same time.

This is in contrast to what happens in the stock market, where highly valuable information is initially available to certain people, like company CEOs and other individuals involved in the business.

There is no central of Foreign Exchange Market, but the market is created by the flow of transactions made by investors and traders from all over the world.

Billions of dollars of transactions a day, you can join this “Largest”¬†financial market through HotForex now.

How Stocks and Forex markets are different?

There are dozens of financial markets in the world. The popular markets are especially Stocks and Forex in terms of trading volume.

If you haven’t started trading in both of the market, you may not know how different they are exactly.

Let us give you some ideas of “How different stocks and Forex markets are”.

First of all, Forex market is much larger than the stock market. In fact, the trading volume is the highest in Forex market, and it reaches to over 7 billion dollars a day in recent years.

As the market is so big, it is impossible to control the Forex market completely. But stock markets? Yes of course it is possible.

The concept of “ownership” is also different. As you can own a Stock, but you won’t really own anything but positions on the web when you trade Forex.

In terms of trading conditions, Forex is available with very higher leverage. Stock market is where low leverage around 1:25 is available, but in Forex market, you can even have 1:3000 leverage.

This leverage makes retail traders easier to trade in the market.

Which do you choose to trade?

With HotForex, you can trade Forex and CFDs including Equity Index, Commodity and Metals. You can just open an account, and access to all of these financial instruments.

HotForex Official Website

If you are looking for a broker where you can trade Forex and Stocks together, please go to the page below.

List of Forex and Stock Brokers

Conclusion

Based on this information you can make the following conclusion: Stock Market and Forex – they are two completely different incarnation.

They are not opposing substances, they just coexist.

Your choice depends on your preference and the final objectives of investing.

HotForex customers have a unique opportunity of unlimited trading, as the market Forex, and global stock markets.

All you need – is to realize that it is more closer to you.

HotForex is confident, thanks to a wide range of investment opportunities in the company, you will always find something useful and interesting.

Trade with HotForex and be sure that you are on the right path to the formation of its exceptional strategy of financial independence.

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