There are many options for investment, such as foreign exchange, stocks, bonds, funds and futures.
With stock funds in a slump, foreign exchange and futures, which can be traded in both directions, are favored by most investors.
Table 1-1 shows the comparison of major investment products.
Table 1-1 Comparison of main investment products 1. Which is better to invest in foreign exchange stocks?
Compared with stocks, foreign exchange investment has obvious differences and advantages, which are as follows.
1. Profit can be made in both rising and falling markets. Different from the stock investment market, the foreign exchange market does not have the constraint that cannot be shorted.
In the foreign exchange market, investors have the potential to make profits regardless of the trend of the market, whether they hold long or short positions.
Because currency markets always involve buying one currency versus selling another, there is no structural problem.
That means investors have the same potential to profit in rising or falling markets.
2. Higher fund utilization rate than stock investment In the international market for foreign exchange trading, investors can enjoy a certain multiple leverage ratio financing.
In the stock market, investors can control only $1,000 worth of shares for every $1,000 invested.
But in the money market, investors can control up to several times the principal amount if they invest a $1,000 margin in a foreign exchange transaction.
3. Fx Trading can fully satisfy technical investors The strong trend in FX trading offers significant benefits to technical investors.
Unlike stock investments, currencies do not rise and fall in a narrow range for a long time. Instead, they exhibit a strong trend of development.
More than 80 per cent of investments are speculative in nature, so the market usually overshoots and corrects itself.
Investors who have studied technical analysis often find it easy to identify new trends and breakthroughs, and thus find several different opportunities to enter and exit the market.
4. It is easier to understand trends in different countries than to analyze changes in companies. Countries are generally more stable than companies, which means it is easier to predict the direction of economic development.
Currency transactions are paired, where investors buy one currency and sell another.
Just like stock investment, the investment currency should be a fast growth rate, and the economic conditions of the country is better.
For foreign exchange, the trend of different countries can be analyzed from multiple aspects, as shown in Table 1-2.
Table 1-2 Analysis of Trends of Different Countries in Foreign Exchange Investment At the same time as the analysis of foreign exchange investment and trends of countries, a large number of economic data will be published regularly. Of course, some are more important than others. For example, data on interest rate and international trade gap must be closely examined.
5. You can trade stocks 24 hours a day. Trading liquidity is low after trading hours, and it is not easy to trade stocks.
But in forex, the world’s largest and most liquid market, investors can trade around the clock.
(For global FX trading hours, recommended: Global FX trading schedule, what is the best FX trading Beijing time?)
Two, which foreign exchange stock investment risk?
1. Stock T+1 trading system: buy today, sell tomorrow;
Foreign exchange T+0 trading system, anytime you buy, anytime you can sell.
In terms of liquidity, foreign exchange risks are small.
2. The foreign exchange commission is very low, only the point difference deducted when buying, and the stock also needs to pay stamp duty, so the risk and cost are smaller.
3. Foreign exchange has leverage (50, 100, 200 times), and with a small capital cost, you can get a large expected return (risk and expected return coexist), but the higher the expected return, the greater the risk, so the greater the foreign exchange risk in this aspect.
4. Foreign exchange investment targets the national economy and can be traded in a fair, just, open and objective manner, while stocks are safer than stocks because market makers may manipulate the stock market.
The stock of our country can only rise to make money;
The rise and fall of foreign exchange can be done, there are profit possibilities and opportunities.
6. Stocks have the limit of falling, while the risk of foreign exchange is mainly in heavy position trading. Since there is no limit of rising or falling, the risk of foreign exchange will be greater.
There is no doubt that the risk of foreign exchange is relatively greater. Stocks have no leverage, and T+1 and the limit of the rise and fall range are the first risk control guarantee for investors.
But without good trading discipline, the risk of doing any trade is unmanageable (as in the recent Crude oil case).
The risk and profit of the investment market are coexisting, can not only see the profit, not aware of the risk.
Conclusion: 1. Stock is a regional market, while foreign exchange is an international market.
2. The daily turnover of the foreign exchange market is much larger than that of stocks ($3 trillion in gold;
Annual stock market turnover of 15 billion yuan);
3. Stocks are easy to be manipulated by dealers or groups;
4. In terms of trading time, stocks are traded for 4 hours, while foreign exchange is traded for 24 hours;
5. According to the trading rules, stocks can only go up, while foreign exchange can go up or down;
6. There are limits on the rise and fall of stocks (10% for A and B shares), but not for foreign exchange;
7. Stocks have no leverage, and foreign exchange leverage is 1:10 or 1:100, or even higher;
8, in terms of varieties, there are more than 1,000 stocks, stock selection is more troublesome, foreign exchange is easier to analyze 9, listed companies may be liquidated due to poor management, into nothing;
Foreign exchange has always existed and has always been an important part of the international monetary system. 10. Stocks are 100% capital investment and foreign exchange is 10% margin investment.
Is foreign exchange more profitable than stocks?
Both foreign exchange and stocks are high risk investments. Which one is good for making money and which one is risky depends on the risk tolerance of investors.
No matter whether investors are trading foreign exchange or stocks, they need to master the use of various foreign exchange trading skills.
