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Forex vs Stocks

By design trading in the forex market holds many more advantages in relation to trading on traditional stock markets.

24-Hour Trading Day

One of the clearest benefits of trading forex is the 24-hour trading cycle. Within the forex market no actual physical exchange exists where currencies are traded through. Banks around the globe trade with each other via the Inter-Bank system. While it may be the middle of night in Europe, the United States and Asia, there will always be a market open somewhere in the world that currency can be traded and made available. This cycle gives the investor the ability to trade on their own terms.

Lower Transaction Costs

When trading in the forex market, the only transaction cost to trade is the spread - the difference between the bid and ask prices. Making it more financially reasonable by comparison to stock and bond trading, where service and transactions fees are much higher.

Less Short Selling Restrictions

With the same margin requirements as buying long, a trader can sell short in the forex market without added costs and hassle. This allows traders to act on a bullish market as well as a bearish one. By comparison, many short selling restrictions and controls are in place in traditional equity market listings.

Thousands of Choices vs 6 Major Pairs

Unlike stock market listings that have thousands of choices available on 52 different exchanges globally. The forex market is focused on six major currency pairs that are easy to follow, trade, and research.

Accurate, Timely, Publicly Available Research and Data

The important statistics and data released by governmental bodies (e.g. Non-Farm Employment reports, Interest Rate Announcements, Manufacturing and Consumer Data) is made available publicly in real time. Making it less susceptible to manipulation, this makes the trading environment in the forex market a more level playing field for the individual investor.

No Intervention

Unlike purchasing stocks which requires manual execution via human intervention. Forex positions are executed anonymously via the Interbank System, making actual trading faster and more accurate which is a clear advantage when trying to capture the benefits of a strong market move.

Greater Liquidity

The amount of volume traded on any given day in the forex market is nearly USD $4 trillion. While the prices themselves are based on straightforward supply and demand, large transactions of millions of dollars are tiny in relation to size of daily turnover. Filling large transactions in this type of fast moving market is much easier and helps maintain better price stability and consistency.

Adjustable Leverage and Contract Sizes

Leverage is a very powerful option in trading. It provides much greater market exposure, increasing the potential gain on any given position. However the level of assumed risk also increases at the same time. NSFX offers adjustable leverage options from 1:1 to 1:200.
Individuals concerned about the level of assumed risk can decide how much risk they feel is appropriate irrespective of the trading volume or account size. Clients of NSFX have the ability to trade contracts of 0.01. By trading with fractional lots, clients can reduce exposure and apply different trading strategies.

Use of Unrealized Profits

When trading in forex, unrealized profits are available to place new positions and manage existing ones.

* The performance figures quoted are only estimates and may not be reliable indicator of future performance of this investment.

** This information does not constitute an offer or solicitation and is provided for information shall not be deemed to constitute advice and should not be relied on as such to enter into a transaction or for any investment decision. Any opinions expressed in this document represent the views of NSFX at the time of preparation. They are thus subject to change without notice. NSFX believes that the information contained herein is accurate as at the date of publication. However, no warranty of accuracy is given by NSFX and no liability in respect of any errors or omissions, including any third party liability, are accepted by NSFX or any director, officer or employee.


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NSFX is regulated by the Malta Financial Services Authority (License Number IS/56519). RISK WARNING: Trading in Forex and Contracts for Difference (CFDs), which are leveraged products, is highly speculative and involves substantial risk of loss. It is possible to lose all your capital. Your capital is not guaranteed and may go down as well as up. Therefore, Forex and CFDs may not be suitable for all investors. Only invest with money you can afford to lose. So please ensure that you fully understand the risks involved. Seek independent advice if necessary. NSFX Ltd. does not provide its services to citizens of the US.Copyright © 2012-2017 NSFX All Rights Reserved. |
* Prices displayed on the website may be affected by changes in currency exchange rate and price movements thereby affecting your investment return therefrom.
NSFX Ltd is registered in Malta, 168 St Christopher Street, Valletta VLT 1467, MALTA | Company Registration Number: C/56519 MFSA License Number: IS/56519