Forex vs Stocks: Why should you not trade stock?
Last week we saw a massive drop in the stock market. Dow jones drop by almost 500 points.It was the latest biggest drop in a single day after the lehman brothers episode.Many of my friends who were trading stocks were caught out unaware resulting in a massive dip in their portfolio.Some of them who knew that i am a forex investor asked me if i was affected.The answer is and always will be: No.
Forex vs Stocks: Why should you not trade stock?
That’s one of the reasons on why i choose forex over stocks.
Forex vs Stocks Reason No.1
-> Forex traders are not affected by massive news affecting the economy.- At most, we only lose the single trade that we are in when the news happened. Which is only a small percentage of our capital (with the right money management skill)
Forex vs Stocks Reason No.2
-> Generally there is no leveraging for stock traders. (not including margin traders – which is very risky)
– The rich gets rich with leveraging and compounding.
– Whats the point of investing if there is no leveraging.
– Therefore, stocks will probably not make you very rich.
Forex vs Stocks Reason No.3
-> Forex is a 24 hr market. We forex traders usually enter a trade and are out either in the same day or 2. (depending on which time frame you trade)
– Generally, if you hold a stock. It is at least for a few months.
Forex vs Stocks Reason No.4
-> There is no shorting in the stock market. (Not including options)
– Meaning you can only buy it up/long.
And if you notice, the market usually goes up a little with a good news, but drops massively with a bad news.
Forex vs Stocks Reason No.5
-> There is no commission in the forex / currency market.
– The commission may not seem a lot for a single trade, but if you are a full time trader or one who trades a lot. This commission expense will accumulate to a relatively significant figure.
Forex vs Stocks Reason No.6
-> Instant buy/sell in the forex market.
– As the trading volume is so large in the forex market, we do not have to wait for a buyer to take up the lots we are selling (like the stock market).
– Eg. when the stock market is massively falling, you can’t sell even if you want to as there is no buyers who will buy your lot.
Forex vs Stocks: Why should you not trade stock?
The list can go on and on..
But the point i want to make is:
The reason that we invest is to make big money.
Forex vs Stocks at the end of the day are just investment vehicles.So why choose a investment vehicle that will probably not make you very rich? and yet heavily affected by the news in the economy?Just my 2 cents. I may be wrong.
Check out our online forex trading AFM winning Price ActionForex Course where i teach you the exact FULL Forex Day Trading Systems & Strategies that i personally use to be consistently profitable.
See you on the other side my friend,
Asia Forex Mentor
Ezekiel Chew
Asia #1 Forex Mentor
www.asiaforexmentor.com
Next Beginner Article: Forex Robot – Do They Work?
