There are significantly notable differences between trading stocks, futures, and forex. Stocks have been the most commonly traded investment commodity for the greater majority of people within the past 20 years and still remains the number one investment type to this day. Recently there has been a growth in other markets and areas such as futures and forex. At one time many people hesitated to enter these markets due to lack of readily available information pertaining to them. As a result many people felt they lacked enough information to capitalize off these elite markets and stayed clear of them. One of the reasons information on forex and futures were not widely available during this time was due in part to the fact that forex and futures were almost totally restricted and dominated by hedge fund managers. Specialists have noticed there has been a rise in the number of individual traders. Now, today, there is an abundance of tools and help out there to start the average Joe, beginning trader, scrape his first profits and eventually start rolling in the dough with whichever market he chooses to enter.
What is the difference between Stocks, Futures, and Forex - Leverage
- Stocks 2:1 or 4:1 leverage
- Futures 20:1 or 40:1 leverage
- Forex 200:1 leverage
Leverage is one's ability to have a potential increase in the return of an investment as well as a loss using borrowed capital. Using leverage one can claim a great deal of profit as well as lose a great deal of money if a venture goes bad. This is where the difference between futures, forex, and stocks lie. Currently in the futures market you can trade the E-mini or Dow mini futures with 20:1 or 40:1 leverage. Stock has less leverage and remains at a ratio of 2:1 or 4:1 leverage. Due to futures leverage you can lose more than you invested. Forex is at 200:1 leverage which makes it highly profitable if you have the right strategy and knowledge.
Forex is by far the most profitable One of the downsides that most novice traders will come across in Forex is that there is a high learning curve. This often means that it will take a while before the novice trader gains the experience and knowledge necessary to enjoy the full prosperity of the Forex market and their investments. Luckily this is no longer the case. There is now ground breaking technology in the form of Trading Robots that can fully automate your forex trades for you at all hours of the day. These systems are extremely accurate at determining market trends and have been proven to work again and again. One of the best and most affordable trading robots out there right now used by the experts to rake in the dough is the Forex Funnel found here at Forex Funnel. |
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