Forex vs Other Markets

Forex vs. Equities and Futures

The trading of foreign exchange provides significant advantages over equities trading and futures trading. In addition to these advantages, the seamless 24 hour nature of the Forex market gives the trader the unique advantages of reacting to news and worldwide developments instantaneously, participating in real-time in the largest trading market in the world.

Ability to Profit in Rising or Declining Markets:    Unlike equity and fixed income managers, a Forex trader is able to profit under any market conditions by either buying or selling a particular currency in relationship to another ***. In the Forex market there will always be one currency strengthening against another, unlike stock shares that move only up or down.

Global Diversification:    The performance of equity and fixed income investments in one country is often highly correlated with the performance of equity and fixed income investments in other countries. As a result, global portfolios composed solely of equity and fixed income investments lack full diversification, even if they are geographically dispersed. Investing in currencies gives investors access to markets beyond equity and fixed income investments, providing more complete diversification and a reduction in portfolio risk.

Reduce Portfolio Risk While Enhancing Returns:   When combined with an investor's existing portfolio of equity and fixed income instruments, the Forex Managed Account Program may reduce the volatility and risk of that portfolio while potentially enhancing long-term returns **

*The FCM/broker is compensated by revenues from its activities as a currency dealer, including proceeds from buying, selling, converting, as well as holding currencies and interest on deposited funds and rollover fees.

**Disclaimer: Increasing leverage may increase gains or losses on any given trade. ***Forex trading involves a substantial risk of loss.