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Forex vs stocks

During tough economic times throughout the world, many people feel concerned about starting out in the stock market and other investments. This concern and fear can be eased by learning more about what the similarities and separations between different kinds of investing are, and how they work.
Forex, or the foreign currency exchange, offers another option to people who are interested in investing. Also referred to as FX, Forex is where you may buy a quantity of one kind of currency in exchange for a quantity of another kind of currency. The exchange of one for the other takes place simultaneously. This allows exchanges between currencies in order to purchase something in another currency, as well as the opportunity to make profits on rising or falling values of different currencies throughout the world. Forex can be used by anyone – individuals as well as businesses and governments, meaning there are usually no commissions to be paid out to a third party or middle man. Forex can take place completely online.
The stock market, also called the equity market, trades company stocks or financial agreements called derivatives in an open or private market. Stock is usually a small percentage of ownership in a company. If the value of the company you have stock in is rises, your stock is worth more. If the value of the company drops, so does the worth of the stock. Stocks are traded on the stock exchange, either virtually or in a physical location. Many stocks are bought and sold through brokers, both for individuals and for corporations. A stock broker is a person who has passed an exam and become a member of the exchange. Trades in the stock market must be carried out by a member of the stock exchange, so to trade in stocks, you should have a stock broker to help you. A stock broker or agent may either charge a percentage based commission or a flat fee for their services.
Forex, trading in currency rather than business futures, is based on the exchange rates. Exchange rate fluctuation is generally caused by expected or actual flow of money through any given country. Gross Domestic Income (GDI) or Gross Domestic Product (GDP) growth, surplus or deficit in trade and budget, inflation and interest are some of factors that affect the value of a country’s currency.
Stock value is determined by the speculation of the long term earning prospects of companies. If a company is expected to do well, stock prices will usually rise. If a company appears to be doing poorly, stock prices will usually fall. Some of the factors affecting stock prices are the political, financial and possible outcomes of individual companies, the general economy of the areas those companies are in, as well as by the state of the world market. However, there is not always a concrete explanation for the rise or fall of any given stock, creating a high level of risk, as stock value can plummet suddenly and without explanation.
Some investors prefer the Forex system simply because of availability. The US stock market is open for business 9:30 am to 4:00 pm, with pre-market trading between 8:00am and 9:30am and after market trading from 4:00pm to 6:30pm eastern standard time and is closed on holidays. Forex is open from 5:00pm eastern standard time every Sunday to 5:00pm eastern time every Friday. While a given nation may be closed to trading on its own national holidays, Forex itself does not close for any holidays, and so has a much larger trade window on both a daily as well as yearly basis.
Trading the forex market can be very profitable, but is also very risky. Before trading forex you must be aware of the risks involved, including the possibility of losing the full investment. Never trade with money you can't afford to lose. This website is not intended for citizens and residents of the United States of America. 
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