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Forex Market Comparison
Forex vs. Stocks |
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Advantage |
Forex Market |
Stock Market |
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Trade Around the Clock |
Yes |
Limited |
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Pay No Commissions* |
Yes |
Limited |
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Unlimited Short-selling |
Yes |
No |
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Market Information Easily Available |
Yes |
Yes |
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| Trade Around the Clock |
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| The forex market is a near-seamless 24-hour market. Subject to available liquidity, FXCM offers trading from Sunday, starting after 5:15 PM EST, until Friday, 4PM, EST (FXCM Client Service is available 24/7). With the ability to trade around the clock, currency traders have the advantage of customizing their own trading schedule; they can usually get in or out of the market at any time without waiting for an opening bell or encountering a market gap. While trading stocks after usual market hours is possible, very often that possibility is negated by a lack of order flow or a drastic widening of the bid-ask spread. |
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| Pay No Commissions* |
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| In the forex market costs are confined to the bid-ask spread. FXCM charges no commission or additional transaction fees, and its customers trade on spreads provided to FXCM by some of the world's largest banks via the FX Trading Station. In the stock market, “no-fee” programs are frequently offered only with provisos mandating minimum account balances or minimum trades per month. |
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| * FXCM is compensated through the bid/ask spread except where otherwise noted. Please note commission charges apply for certain classes of non-standard accounts such as Active Trader. For additional information click here. |
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| No Uptick Rule |
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| Unlike the equity market, there is no restriction on short selling in the forex currency market, no matter which way the market is moving. Since currency trading involves buying one currency and selling another, a trader has the same ability to trade in a rising market as in a falling one. |
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| Forex Market Information Easily Accessible |
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| Information about stocks is abundant, but so are the stocks. Finding a trade opportunity in the equities markets may mean sifting through data on thousands of stocks, while the forex trader has only six major currencies to research. Additionally, the vital information that moves equity markets, such as revenues and profits, is proprietary and private, and sometimes subject to fraud, deception and insider trading. In contrast, virtually all of the news that bears on the forex market is in publicly disseminated reports from governments or research institutions, and released to everybody at the same time. |
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| The knowledge you've gained in analyzing stocks is easily transferable to the forex market. Many of the economic indicators familiar to equity traders, such as payroll data and interest rates, affect the currency markets. And many technical traders have found the forex market to be particularly attractive, since currencies respond well to many of the common technical indicators, such as MACD, RSI, and Candlestick charting. |
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| To learn more about transitioning from trading equity markets to trading in the Forex market, contact the FXCM staff today at 888-503-6739.
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Think You are Clueless about the Currency Market? |
 If the Australian stock market rallies
the Australian dollar SHOULD |
 If the US current account deficit widens due to a Chinese sell-off of US treasures, the US dollar SHOULD |
 In a surprise decision, the FED raises interest rates by 50 bp. The US dollar SHOULD |
 If oil prices surge to record highs, what effect will this have on the US dollar? |
 An increase in unemployment numbers in the US will have what effect on the US dollar? |
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