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Showing posts from October, 2019

How is the Trading Forex Different from Trading Stocks

The two financial trading industries are complex and have their own different sets of risk levels. There are stock traders who invest in forex and forex traders are trying their luck in stock marketing. For a new trader, the choice can be quite confusing. One of the most prominent reasons some traders favor the forex to the stock market is forex leverage. Below, we explain the differences between stock trading and forex trading. 1.       Cost of entry You will need much smaller money for entering the forex market rather than the stocks one. Although forex market demands lower entry resources, you can make use of leverage. This instrument helps traders to magnify their profit (or losses) and make greater capital from the smaller investment. 2.       Lower spreads on forex Spreads, the difference between the bid and ask price are on average smaller resembled to stocks. Although some large-cap stocks have tight spr...

Factors that Affect the Forex Currency Exchange Market

The values of currencies fluctuate constantly on the forex market because Forex is being affected by many factors. It is important to understand each one of the fundamental factors of Forex that cause fluctuations in foreign exchange from day today. These are also explained by the  Forex Mentors .  This article examines some of the leading factors that influence the fluctuations in exchange rates and also explains the reasons behind their volatility. Let's start this! Inflation Rates Inflation rates play an important role in Forex Market . Currency pairs are more volatile around the time when the inflation data is released. Changes in inflation rates result in changes in currency exchange rates.  Interest Rates Forex rates and interest rates are correlated. A country with a lower inflation rate will see a rise in the value of its currency while a country with higher inflation typically sees depreciation in its currency and is usuall...