Forex vs. the Stock Market

Many people are finding that they enjoy Forex trading because of the differences Forex as compared to stock markets.  Forex trading is a very liquid market.  It also reaches volumes as much as 100 times more than the NY Stock Exchange. 

Because Forex is the trading of currencies, there is no insider trading.  Nowadays we are seeing a lot of fraudulent activity in the U.S. stock markets, including the largest Ponzi scheme in the history of the world.  Because currencies are traded in Forex, manipulation of the market is not a danger that investors need to worry about.   No one has a true insight into the market, so they can't really do anything to make the market move towards their advantage.

Many stock market investors will purchase stock because they think it is at a price that will make them a profit in the future.  The problem that they run into is that some stock brokers don't make the stock purchase immediately.  Even if an investor is purchasing online, the stock may not be purchased right away.  When the purchase of stock is eventually processed, the stock may have a completely different value.  Because of the small profit margin with most investor's transactions, the stock purchase may have not made a profit, or worse, lost money in the transaction.  Because of the 24 access to Forex trading, investors can have more confidence in making a profit.  The market is closed on the weekends though.
 
Stock markets are very volatile, especially today's markets.  Companies fail.  This is a hard truth that anyone who has invested money in any of the failed 'blue chip' companies that have been around before all of us were born.  Companies that were over 200 years old completely disappeared overnight.  Their stock value disappeared with the companies. The currencies that are traded on Forex can't disappear like that.  It can go down in value, but it would not disappear.

One of the big problems about stock market investing, is the investment doesn't really buy anything tangible.  There isn't anything that you get, that you can hold in your hand, for your money.  Some people would argue that the tangible item is the stock certificate.  The truth is that the majority of people that invest in the stock market, including money market funds, 401Ks and any other investment vehicles that involves stock, never see any actual stock certificate. Most people get a monthly statement or check their account online.  When the large companies, the ones that were 'too big to fail'....failed, most investors just saw the number drop on their account statement.  Sadly, some people saw the number drop dramatically.

Forex is different.  With Forex it is a matter of how many Yen it would take to buy a U.S. dollar or vice versa.  Because of the size of the economies of the country's currency available for trading on Forex, and the fact that you are purchasing a tangible item, the chance of you losing your life's fortune is minimal.