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Comparison with Other Financial Products
Comparison with Other Financial Products
Comparison with Other Financial Products
Forex vs Stocks
Forex | Stocks |
Trading Hours | |
The Forex market is open 24hours a day | You can only trade during trading hours of respective stock market |
COMMISSION FEES | |
Hirose Financial UK does do not charge commission fees; we are compensated through the bid/ask spread | Stocks trading always need middlemen, or to put it in another way, you always need to pay a commission fee |
ORDER EXECUTION | |
Under normal market conditions, transactions are executed instantly | It can sometimes take while to execute a trade, especially illiquid stocks |
SHORT SELLING | |
Traders are free to take long/short positions in the market, because currency trading involves buying one currency and selling another | Short selling is restricted by the ability to borrow a stock and by regulation |
MIDDLEMEN | |
Traders trade directly with the market. And as the forex market is decentralized (each currency dealer has different quotes) traders can get the best rate of their transaction | Traders always need middlemen for stock transactions, be it brokers or the other entities, and the middlemen will charge fees for the service |
MARKET MANIPULATION | |
Forex market size is very large that so the possibility of any individuals, funds, banks, governments to control and influence the market rate is small. | Market size is limited, and the possibility of it being controlled by large institutional players is quite high |
Forex vs Futures
Forex | Futures |
LIQUIDITY | |
In the Forex market $4trillion is traded daily, hence the market is very liquid | The futures market trades $30 billion daily. Compared to the forex market, liquidity is much less |
Trading Hours | |
The Forex market is open 24hours a day, 5 days a week | Traders can only trade during the respective futures market trading hours |
COMMISSIONS FEE | |
Hirose Financial UK does not charge commission fees, as they are already compensated through bid/ask spread. | Traders are required to pay the brokers commission per transaction |
PRICE CERTAINTY | |
Forex trading execution is fast, and the executed price is almost always the same as the market price, under normal conditions. | The price quoted is often represented by the last trade price, not necessarily the price for which the order will be executed at |
LIMITED RISK | |
Hirose Financial UK has implemented a Margin Call Policy to protect its clients from losing more money than remaining balance in their accounts under the normal market conditions. | Due to liquidity issues it is possible that client positions may be severely affected by changes in trading sentiment. if the trader's P&L suddenly becomes negative, the loss may be larger than the funds the trader has in their account |