Difference Between Forex And Stock Market
The Forex and Stock exchange markets have similarities, but are over all different in their process execution. Forex is revolved around currency trading, while the Stock market deals with shares and obligations. The biggest stock exchanges are in some of the world’s biggest cities; New York, London and Tokyo.
The volume of involved money is perhaps the biggest difference between the two. Buying shares on the stock market requires a very big capital which could be around 10,000 or 100,000 dollars, and then the trade is slow and steady. The Forex market on the other hand is more volatile and can make more spastic movements, however it is much cheaper to invest in Forex with brokers as cheap as 100-200 dollars.
The stock Exchange market is split in to two main categories, the primary markets and the secondary markets.
The primary markets play a key role in the country’s economy, and economic growth rate and efficiency depend on it entirely, it deals with trading new securities, which are bought by either individuals or institutions like investment funds of insurance companies.
The secondary Market consists of the curb market and stock exchanges, and it is the place where investors purchase securities or assets from other investors, however they do not influence the investment volume of the country as a whole. The secondary market is used mainly by speculators who buy assets at low prices in order to sell them at a later point at higher prices.
The price of the stock market is formed by picked specialists, issuers, intermediaries, and investors based on specific criteria. They include in their decision profitability of the assets, peculiarities and amounts of revenue, in order to determine the price formation strategy.