Trading forex (foreign exchange) aka foreign currencies, has recently become one of the most sought-after business opportunities. Plus, forex trading is widely mentioned in various media, both digital and print.
In addition to forex trading, the other much in demand is stock trading . But between the two, forex trading is predicted to be more profitable than stocks.
Although both types of investment are “high risk and high return” there are many advantages offered by forex trading compared to other types of trading, including stocks. Technological advances also have an effect.
1. Less capital
Money or capital has always been one of the main factors in determining something. Even when you decide to trade . The capital used to trade forex is less than stock trading.
Even now there are many brokers who offer capital with only US $ 1 only. Profits can be 100 or even 1000 times. Meanwhile, for those who want to trade stocks, it requires a large enough capital.
Also in terms of commissions for brokers, forex trading does not charge any additional fees.
Usually, they take advantage of the spread (or the difference between the buy and sell rates). Meanwhile for stock brokers, usually they will cut commissions between 0.1 – 0.3% for each transaction, be it when buying or selling.
2. Forex Trading Market Open 24 Hours
For those who have a myriad of activities, the forex trading market is quite easy. Because it is open 24 hours a day in 5 working days. This 24-hour trading is also standard worldwide, following the world’s forex regulations .
So whenever you have time to trade, you can just contact CS. Meanwhile, for stock trading , the time is arguably less flexible.
The stock market is usually open during office hours. Starting from 08:00 or 09:00 until the afternoon. Of course, this is quite a hassle for office workers who want to trade stocks. The times will collide.
3. Fairly High Liquidity
Another high leverage broker is that it has high enough liquidity. This means that you can withdraw funds for transactions at any time.
Almost every day the turnover of funds in the forex market can reach trillions of dollars per day, and it can be used for transactions.
Meanwhile, for stocks, the funds flowing into the stock exchange need to be distributed to hundreds or even millions of shares every day. So the liquidity is not as flexible as forex or forex.
4. Most Have Trial Accounts
To attract more traders , brokers are competing to give the impression of being trusted. That’s why today, there are not a few forex trading platforms that provide demo accounts or trial accounts with fictitious capital.
So, this is of course very beneficial for novice traders. Can be simulated before making transactions with real capital.
This trial account can also train traders to be even more observant in taking opportunities in the future after actually jumping in. And this has indeed been proven, many traders learn it from this trial account .
5. Low Level of Complexity
Another thing that makes many traders have forex is the low level of complexity. Just imagine, when investing in stocks, there are more than 500 companies that offer their shares.
You need a lot of time to investigate one by one in order to minimize losses. Especially if you are a beginner, of course there will be many other things that need to be learned.
However, if you choose forex trading , it will not be as complicated as stocks. There are only a few types of currencies to choose from. There are American dollars, euros, pounds, and also the Japanese yen. Of course, because the eye type chosen is not too large, you have plenty of time to inspect other factors.