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Forex Trading Vs. Futures – What You Should Know

The Forex Market, or FX Market as some term it, is one of those markets where you can make double digit gains. You can also make double digit gains in the Futures market as well. There are distinct differences between the two markets and you will want to know what they are before you enter into either one.

Liquidity:

Forex Trading has the advantage of being more liquid than any other market, including the Futures Market. With the average daily volume in the Forex Market reaching close to 2 Trillion and the daily volume in the Futures Market reaching 30 Billion, there is no comparison. The liquidity in Foreign Currency Trading (Forex) far surpasses that in the Futures Market. This means when it comes time to trade, Forex Trades will be filled much easier than in the Futures Market. This speed means greater potential profit. Couple this with instantaneous trade execution in Forex Trading, and you have the ability to make a lot of trades quickly.

24 Hour Trading:

Another advantage the Forex Currency Trading System (Forex) has compared to Futures is the fact that you can trade 24 hours a day, five days a week if you want. The Forex Market is open longer and for more hours than any other market. If a person is serious about making money in a market, it sure would be nice to have virtually unlimited time each week to make those trades. Whenever some event happens around the world, you can be one of the first to take advantage of the situation. You won’t have to wait for a market to open in the morning. You can trade from your computer instantaneously.

Rapid Trade Execution:

When you use a Forex Currency Trading System you receive immediate trade executions. There is no delay like there can be in the Futures or Equity Markets. And your order gets filled at the best possible price instead of guessing at which price your order might get filled.

No Commissions:

Forex or FX Trading is Commission Free because it is an inter-bank market which matches buyers with sellers in an instant. There are no middleman brokerage fees as in other markets. There is a spread between the bid and ask price and this is where Forex trading firms make a little. This means you can save money when you trade Forex compared to Futures trading where there are typically commissions.

Greater Leverage:

Online Forex Trading gives you much greater leverage than playing the Futures Market. However, in the Futures Market, you can also buy or sell options on futures, which increase your leverage. Leverage can be very important when you know what a currency is going to do. You can achieve 200:1 and greater in Forex Trades compared to much less in Futures. This means a lot more potential profit, again if you make the right moves.

Limited Risk is Guaranteed:

Since Forex Traders must have position limits, the risk is limited since the online capabilities of the Forex Trading system automatically initiate a margin call when the margin amount is greater than the value of the account in dollars. This keeps a Forex Trader from losing too much if their position goes the other way. It is a good safety feature that is not always available in other financial markets.

When considering the differences between Forex Trading and Futures Trading, just keep in mind your preferred trading style and the type of risk you don’t mind taking. There are definite advantages to FX Trading that may allow you to profit greatly if you develop a good system and stay within your trading limits. If you are ready to go, then begin investigating a good firm with whom to open a Forex Trading Account.

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Forex Trading - Google News FXCM Expands its Mobile Trading Services DailyForex.com (blog) Mobile Forex trading is something we've been discussing a lot lately, as Forex brokers and market analysts are trying their hand at developing apps that will revolutionize the Forex world…or at the very least, to simplify the process on some level. Currency Trading Platform iFOREX Introduces 1-on-1 Forex Training MarketWatch (press release) ROAD TOWN, Tortola, May 14, 2012 (BUSINESS WIRE) -- Foreign exchange and CFD trading platform iFOREX has today announced the expansion of their Forex training services. All new iFOREX clients can now take advantage of a complementary 1-on-1 tutorial ... Online Trading Platform iFOREX Expands its Development Team to Offer More ServicesSunHerald.com iFOREX introduces one-on-one forex trainingCPI Financial all 11 news articles » How can I Benefit from Trading Forex with the MT4 Android App? MarketWatch (press release) SADDLE RIVER, New Jersey, May 18, 2012 /PRNewswire via COMTEX/ -- The MT4 Androidâ„¢ App for FX Solutions LLC is a powerful tool for traders to access the global currency markets from virtually anywhere in the world, at any time. and more » AFP India Likely Intervened In Forex Market Wall Street Journal The RBI doesn't say whether it intervened in the currency market and has a stated policy of intervening only to smoothen volatility. But, the RBI's recent support for the rupee, at a cost of $20 billion since September last year, looks like an effort ... RBI keeps an eye on currency bets, intervenes to lift rupeeEconomic Times RBI seeks forex conversion dataBusiness Standard Indian Rupee Off Fresh 5-month Low Against U.S. DollarRTT News Outlook all 580 news articles »

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