Forex or stock market?

Форекс или фондовый рынок

There is a desire to try yourself in the role of a trader, but you have no understanding of what type of the market is better for you? Forex or stock market? No, of course I cannot make a choice for you, but I can describe a difference, I think I will partially succeed, and then the choice is yours!

Where it is better to trade

In order to compare the benefits of Forex trading and the stock market, I opened an account here and there out of curiosity. That’s what happened in the end:

  • dealing centers are ready to offer the trade with 1-10 dollars, minimum deposit for the stock market – 30 thousand rubles. If you find less — let me know, I would be very grateful. However, it is logical. DC with a deposit of $ 10 are trading within themselves, and the sum  with direct access to the stock exchange starts from $ 1,000;

  • taxes. The broker, which brings a trader on the stock exchange, is the tax agent of the trader. In withdrawals, the tax is automatically deducted from the profits without any participation of the trader. When trading in the Forex market, the issues of payment of taxes lies on the conscience of the trader. However, if in the first case, the trader can always ask for proof of income, then DTS can hardly help here;

  • account opening in Forex takes 10 minutes, 20 minutes takes a verification (for client — 20 minutes for the broker — longer). Account opening for stock trading — one week. First, you need to leave the application, then sign the documents, etc. (Forex or stock market? For speed and simplicity — Forex);

  • the trading volume. In the stock market you can know the real volume of transactions on the Forex you can’t;

  • limit orders. In the stock market the order is visible to other traders (trader becomes the liquidity provider). That is, the trading is held without spread for the best price. In Forex everything is radically different: here the profitable for the stock market strategy may be unprofitable because of spread and commissions;

  • the speed of execution. As the practice shows, the Forex brokers inhibit transactions. Transactions in the stock market are much faster. Maybe I’m wrong?

  • the costs. Using limit orders the costs on the stock exchange is less than in Forex;

  • leverage. Dealing centers offer leverage up to 1:1000, on securities — a maximum of 1:20. For those who like the martingale strategy, there is nothing to do in the stock market, the similar situation is with the locking;

  • opportunities. One thing is to watch the currency pairs, another is to work with such tools as bonds, stocks, futures for the same currency, options. Exchange market has everything.

My opinion of course for the stock market. After all, what is Forex? This is speculation on the difference of currency rates. That is making money on something that was up somewhere, something went down somewhere. If one trader earned, the other lost, the flow of money, but there is an added value. Investing in bonds, I understand that I lend money to the state debt or companies that will be put on investments in production, expansion or retooling. The money I invested in stocks or bonds provide economic growth and help create something new. And understanding that when you buy securities, I’m making a contribution to the world economy, inspires.

And to summarize:

  • the stock market offers investors a lot more options in comparison with Forex. But the barrier of entry is much more;

  • for professional trading the stock exchange is preferable, for the novice investor – Forex with minimal requirements for entrance;

  • the reliability of the stock market is higher than in the Forex.

Investment exchange portal always ready to help you with your choice of broker strategy and to become your reliable assistant in stock trading. Forex or stock market? Read on our publications to choose!

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