The Stock Market Vs the Forex Market – What's the difference?

The Stock Market Vs the Forex Market – What's the difference?


The FX market is also known as the foreign exchange market. Trading between two countries with different currencies is the true basis of the Forex business model. Currency trading has been around for over 30 years, as it was established in the early 1970's. The trading or selling of contracts is not based on any one business and it does not involve investing in just one business. You are simply trading currecnies for profits.

The currency market and the stock market are very different business models. The difference between the two is the amount of trading that occurs. Millions upon millions are traded daily on the currency market. It is estimated that the daily amount traded is around two trillion dollars. That amount is way higher than the amount traded on the stock market daily by any country. The forex market has involved with governments, banks, financial institutions and other similar types of institutions from other countries.

Another major difference between the two is the fact that it's global, worldwide. The stock market only takes place within a country. The stocks are mainly based around business products sold in a country, and the forex market includes any country.

The stock market has set business hours which revolves around the normal business hours of any given day. The FX market is open 24 hours a day because of the vast number of countries that are involved in the trading practices. With this many countries participation the difference in time zones keeps the market open around the clock.

The stock market in any given country is going to be based on that countries currency. In the FX market you are involved with many different countries and many different treaties. These are just a few of the differences between the two.


Source by Mike J. White

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