5 Reasons Why Trading Currency is Better than Trading Stocks

Forex tips

Here are some reasons why trading currency is so much better than trading stocks in my opinion.

1. Liquidity
In the forex market, over $3.98 trillion worth of trades are traded daily, which makes the currency trading market the most liquid market in the world – trading in 1 day what Wall St. trades in 1 month. No matter what time of the day or night it is, the forex market is always moving, and around the world active traders are buying and selling currencies.

2. 50 times more leverage than trading stocks
With stocks, leverage is typically 2:1. But when you trade Forex, you can use up to 50:1 leverage. For example, if you invest $1,000 in stocks, with 2:1 leverage you may buy up to $2,000 worth of shares. However, if you invest $1,000 margin on a foreign currency trade, at 50:1 leverage, you can control up to $50,000 in currencies. Leverage is one of the most appealing and risky factors of the forex market. Traders should note that trading using leverage may increase potential gains as well as losses on any given trade.

3. No Middleman
Spot currency trading bypasses expensive middlemen that are always associated with trading stocks. With forex, clients are able to interact directly with the currency market, and can buy and sell at the simple click of a mouse. No mess. No hassle. No middleman.

4. Commission-free
You are never charged a commission. No clearing fees. No exchange fees. No brokerage fees. No commission on your trades.

5. Trade forex 24-hours a day
Currency trading is available twenty-four hours a day, starting on Sunday at 5pm EST with the opening of the market in Sydney and Singapore. A short while after, the Tokyo market opens. Then London, which opens at 2am EST on Monday. And, by daytime in N.Y., the currency market has already been very active for fifteen hours. With currency trading, you are able to decide when to trade. Trading stocks when the U.S. markets are closed is difficult and only offers limited liquidity. With forex, you can trade twenty-four hours a day, from Sunday at 5pm EST. until Friday at 5pm EST.