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A Comparison of Equities and Forex
A huge factor that is very different in the market of Forex is the amount of trading possibilities, there a very few in the market of Forex, as a pose to many in the market of equity. The Forex trading world only needs to focus on the different sets of currency, the main ones are: (USD/CHF, USD/JPY, EUR/USD, GBP/USD), and of course the 3 pairs of commodities (AUD/USD, NZD/USD, USD/CAD).
Markets trading in equity can sometimes go into a dip, leading to a slowdown in trading and business to drop, and consequently traders may not be able to close or open a position exactly when they would like. Moreover, when the market is shrinking, it is only an experienced and shrewd equity trader that will come out with a profitable sum. Due to tough guidelines and rules in the U.S market of equities it is hard to ‘go short’.
The forex market is liquid, and this results is smaller margins with a greater leverage. You will not find margin rates that are low in the market of equity. Many customers who deal with margins in the market of equity require a margin of a minimum of half of the investment value. Dealers in forex require 1%, which is of course far less.
At this moment it is likely that you have a rough idea about forex and what is involved. Please see the other tutorials.
A Comparison of Equities and Forex