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The Difference between Forex and Stock Market

Have you ever wondered about the difference between forex and the stock market?

Well, here are a list of differences to solve the most common doubts about forex and stock market. The largest difference between forex and the stock market is what you are trading. Forex, or foreign exchange, is a marketplace for the buying and selling of currencies, while the stock market deals in shares – the units of ownership in a company. Therefore, the possibilities in trading forex could be endless.

Today as traders have access to a growing number of instruments and assets, deciding which of these markets to trade can be complicated. Here is a list of factors that highlights forex from stocks.

Volatility: This is a measure of short-term price fluctuations. Many short-term traders are attracted to the forex markets, while buy-and-hold investors may prefer the stability offered by blue chips. However, the price volatility in forex is what most traders prefer for faster results.

Leverage: Another aspect to be considered is the leverage. The forex market offers a substantially higher leverage. As a result, traders could benefit with even slight fluctuations in the market.

Trading Hours: Yet another consideration in choosing a trading instrument is the time period that each is traded. Trading sessions for stocks are limited to exchange hours, generally 9:30 A.M. to 4 pm Eastern Standard Time (EST), Monday through Friday with the exception of market holidays. The forex market, on the other hand, remains active round-the-clock from 5 P.M. EST Sunday, through 5 P.M. EST Friday, opening in Sydney, then traveling around the world to Tokyo, London and New York. Literally, the market is open 24 hours.

Risk Warning

 This material is considered a marketing communication and does not contain, and should not be construed as containing, investment advice or an investment recommendation or, an offer of or solicitation for any transactions in financial instruments. Past performance is not a guarantee of or prediction of future performance. Trust Capital TC Ltd does not take into account your personal investment objectives or financial situation. Trust Capital TC Ltd makes no representation and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast, or other information supplied by an employee of Trust Capital TC Ltd, a third party or otherwise.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.92% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Trust Capital TC does not offer Contracts for Difference to residents of certain jurisdictions including the USA, Iran, and North Korea. Please consider our “Risk Disclosure“.

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