Even though stocks have been viewed as the traditional investment vehicle traders choose to make their money grow, more and more stock traders have discovered the supercharged profitability of forex trading. Stock traders who have seen only mediocre results in the stock market have seen great success after making the switch to forex. Actually, active stock traders are leaps ahead of other traders who decide to start trading forex due to their understanding of technical analysis. Forex charts basically obey the same technical patterns as do stocks with some minor differences. Below are some other advantages forex offers traders over the more traditional stock market.

Greater Leverage
Forex trading offers greater leverage allowing traders to control much larger positions with less capital. This allows you to trade the same size positions as you would in the stock market while leaving capital left over to invest in other investments. Many traders start out with accounts as small as $250 and are able to build their account balance very quickly.

No Broker or Exchange Fees
When you trade forex you are dealing directly with your dealer and primary market maker. You won’t pay commissions on your trades to either a broker or an exchange. There are no extra parties between you and the market maker contributing to slippage of your profits. This is unlike the stock market, where you may deal with a broker and the exchange, both who charge fees and commissions. This offers the trader quicker access and cheaper costs.

Buy/Sell Programs do not Control the Market
Any stock trader with any experience has heard of large funds selling or buying causing a dramatic drop in the price of a stock. This is due to the fact that the stock market is primarily controlled by institutional traders which have an effect on liquidity. Forex offers the highest liquidity of any market on earth. This makes the chance of any one fund, bank or company controlling a particular currency extremely unlikely. The tremendous liquidity of the forex market is reflective of its many large participants from around the world, including banks, hedge funds, futures commission merchants (FCMs) and governments.

Thousands of Stocks vs. Four Major Currency Pairs
There are thousands of stocks listed on the three major stock exchanges…What one are you going to put your money in? It’s a tough choice! Do you have the time to do all the research necessary to choose the right company? Do you have time to scan the thousands of stocks for those who are at the point of a good swing trade? In the forex markets you have four major currency pairs and a few other minor pairs to monitor which is much more doable. Many forex traders concentrate on the four majors, decide if they are going to buy or sell, then spend the rest of the day doing something else.

Commission Free Trading
This one’s a no-brainer! Absolutely no fees to brokers, exchanges or middlemen! You simply choose your trade and all you pay is the spread which is minimal. All profits are yours to keep!

These and others are some of the many reasons I switched from stocks to forex over two years ago. I started small at first but soon realized that forex was where I wanted to put my money and have traded forex exclusively ever since.