Why trade stocks instead of forex

Why trade stocks instead of forex

The reasons why I choose to trade stocks over forex or other commodities. S&P Less Risk & Higher Returns w/ Options. Why I Trade Stocks Instead of Forex or Commodities. Education Blogs. One of the common questions I always get is why trade stocks versus commodities, which is 07/04/ · Traders might trade forex instead of stocks because they can obtain far greater leverage. By borrowing money to make trades, investors can potentially enjoy stronger returns. For example, if a Traders might trade forex instead of stocks because they can obtain far greater leverage. Forex traders enjoy an advantage over traditional stock investors by being able to borrow money, and thereby afford a much higher degree of risk than if investing on one’s own without borrowing power at all

Why Trade Forex Instead of Stocks? - Advanced Forex Strategies

One of the common questions I always get is why trade stocks versus commodities, why trade stocks instead of forex, which is inside futures versus forex. And that's also a question that constantly comes up to the mind of people in general. Typically, people start trading something because it just happened to be they started that way, whether it be stocks or for ICS or commodities.

And truly, when you do technical analysis,um, it really doesn't matter which one you trade at the end of the day. If you believe in technical analysis and youtrade off of charts and off of indicators, then really there is not much difference is faras that.

But there is key mathematical differences on why to trade stocks versus futures, which is commodities versus forks. And those mathematical differences are basically factual information, and those are the fact that you have for X as a percentage move of the underlying. It rarely moves compared to commodities or stocks. So forex being the biggest market in the world being that it's a market that trades currencies one currency against another, you're not gonna see a currency.

Of the major, G seven g seven is the Euroyen, Canadian dollar Australian dollar, New Zealand dollar,US dollar, of course in the British pound and the Swiss franc. If you count these currencies, it's about G seven or G eight. Depends which ones you add. The reason it doesn't move a heavy percentage because you're tradingone country's currency versus the other.

For example, of the euro right now is a dollar and 20 cents. And historically speaking, if you look at 20 year chart why trade stocks instead of forex maybe from 80 cents to a dollar 60 and back. They give you that leverage because the currencies don't move as much as compared to again commodities or stocks. Now, remember the leverage you get in. And that move wasn ot only enough to wipe out some traders. It was enough to wipe out some complete brokerage houses, some banks, some banking banking corporations that do that, the clearing firms for brokers.

There was it was that strong of a move that it knocked out even firms and institutions. The second thing you go to is commodities. Commodities are traded under futures, commodities, soybeans, coffee, corn,sugar, silver, gold. Um, just about everything and think of it goes all the way to, uh, cocoa, Thio,cotton lumber, All that stuff.

Those have the second biggest moves in terms of absolute percentage why trade stocks instead of forex. It could be more,but we're talking historically for about years. Same thing you can get with soybeans,which can go up from all the way up to Soybean oil and soybeans Meal did the same thing, So the leverage, the margin you get there is naturally lower and commodities. If you trade, let's say, uh, direct futures and yourtrading, Let's say soybeans or silver.

So if you wanna buy, let's say, ounce of silver. Today's prices. It's about 26 You only have to put up about again, why trade stocks instead of forex. It's lessover margin that they give you,and that is probably calculated based on the notional and how much of a move futures or commodities do The third is stocks stocks.

Iswe probably in? Most of us know it could swing up to percent. It could be i na little asa year. It could be inas much as 10 years ands sometimes longer. Generally, why trade stocks instead of forex, though, a stock is expected to keep going up and up and up over the longer. And why is that? Because stocks behind it behind each stock there is a company,and behind each company there is management.

So typically, it goes up to match along with inflation. Um, not only that, cos obviously make money sooner or later. That's the goal. Or the idea is that they're going to make money. And the dividend also adds up to that. If you constantly invested. And most people usually invest in stocks in the long run, making the price push. Ah, little bit bigger. And if we go back to the whole margin thing, the straight borrowing on margin, they only give you two times. You have to put up half of that.

Now the seare approximations why trade stocks instead of forex forex and for for futures. They could change from one broker to another. Butstocks typically tends to havethe largest moves,most importantly for US option traders.

Options again, if you're call, is leverage without the riskin terms. If you are if you are a buyer off options.

If you're a buyer of options,you get leverage without the risk, meaning you cannot lose more than what you putin to. The stock options are most readily available on stocks. Almost every stock hasoptions, at least most of them,and they're pretty liquid, why trade stocks instead of forex, whereas compared with commodities.

Not all do with forex. I don't even know how to get options. They are. They do exist in certain places. However, they're not as easily available. And if they do exist, sometimes it's only through the futures. But again, for US traders, off options stocks is where we wanna beat because we are investing a fixed amount of capital on an item underlying that and the item underlying that,in this case being the stock we want, ideally,the biggest percentage move to take place in the favor off the direction that we've placed it on.

So again,if you're wondering why we trade stocks versus commodities or for X, the reason inthe mathematical factual reason is stocks move more percentage basis on absolute value as compared to commodities or forex. Keep learning

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Why I Trade Stocks Instead of Forex or Commodities

The reasons why I choose to trade stocks over forex or other commodities. S&P Less Risk & Higher Returns w/ Options. Why I Trade Stocks Instead of Forex or Commodities. Education Blogs. One of the common questions I always get is why trade stocks versus commodities, which is 08/07/ · Why choose the forex market? Why should you trade on the forex market rather than the stock market? Here are some very revealing answers: Size – to be fair, the stock market is no slouch in terms of size. It is thought that around $40bn is traded each day on the New York Stock Exchange alone, for example! 07/04/ · Traders might trade forex instead of stocks because they can obtain far greater leverage. By borrowing money to make trades, investors can potentially enjoy stronger returns. For example, if a