How is the Forex market different from the
stock market?
As a result of its global dimension, the Forex market is open 24 hours a day, which enables investors to correct their positions at any point in time. Given the large number of players, the Forex market has narrow spreads and virtually no price gaps. The lack of price gaps enables investors to count on non-slippage order execution. However, in a very volatile market the possibility for slippage exists.
The large volume of participants also reduces opportunity for insider information. To put it simply, there has NEVER been a case of complete currency collapse in a developed country. The volatility of leading currencies rarely exceeds 1% per day, in contrast to the volatility of stocks, which may fluctuate by up to 10% over one trading session. The Forex market generally provides more opportunities for leveraged trading.
No comments:
Post a Comment