Trading the Stock Market Vs the Forex Market
There are a ton of people who are always looking to invest in a market, any market! With traders, the top two markets that people get into are the stock market and the forex market. These markets are very different from one another, so make sure you understand that before you start to invest.
If I had the pick the biggest difference between the markets it would have to be how much cheaper it is to start trading in the forex market, when compared to stocks.
If you were to compare brokers, you would see that you can open up a mini account with a forex broker for as little as $100. You’d be hard pressed to find a stock broker that will let you open an account for less than a $1000.
But what makes forex trading so much cheaper is that you can trade mini lots. So essentially is only worth like 10 cents a pip. This is great for new traders who want to start trading with real money without worrying about crashing their account.
You are not going to find “mini-shares” in the stock market. If you were to open a stock brokerage account, with $1000, that’s probably not going to last very long. You could only trade 100 shares of a $10. Doesn’t leave much room to “play”, does it?
Also, there are no commissions when you trade forex, like you would have with stocks. In forex, there is a spread, which is the currency variation of the bid and ask. But this isn’t something that comes out of your pocket. It’s built-in the system.
John Templeton has been a successful forex trader after learning how to trade price action. Once he understood that all he needed to trade forex was on a plain chart with no indicators, his profits soared. You too could trade forex the right way.
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Actually the US dollar has been doing nicely through the current crisis. Since this is a international financial event, foreigners assume the dollar is safer than loads of their house currencies.In the Forex market, you’re always comparing one foreign money to another- it’s not just like the DOW that either goes up or down. So if the dollar goes up versus the Euro, one is going up while the opposite is going down. They do not like to speak concerning the Foreign exchange as a result of the PTB (Powers That Be) would prefer that you just make investments your money here within the US of A. If you buy Euros or British Pounds or no matter, you are investing overseas.