Many people wonder what to invest their money in: in currencies, in stocks, or in futures. Similarly to the CFD trading and stock speculation, the forex participants can take control of currency by putting up a narrow margin. The forex market is the most liquid market worldwide and as such it offers many ways for gaining profits.

Every trader has the chance to choose an instrument for trading. Let's see what are the main differences between operating on the stock and futures markets and trading spot Forex. Firstly, there are differences between the bid/ask spread rates. A typical Forex broker would offer a spread of 5 pips on the EUR/USD currency pair (this is the most popular and widely-traded currencies). Meanwhile, when it comes to market spreads, the futures market offers variations between 5 and 9 pips. Secondly, the Forex market can be accessed 24-hour a day, while stock and futures markets operate only 7 hours a day. When trading on stock and futures markets, one has to wait for the markets to open and there is a chance for the prices to gap up or down in the meanwhile.

The forex market offers the highest leverage possible. Thanks to this function traders can execute trades up to $400,000 with an initial margin of only $5000. Morover, the participants can select the range of leverage so that it suits their mode of trading. Another benefits investors can make use of while trading forex is the minimum slippage and liquidity. In comparison, the stock market liquidity is dependent on stock's daily volume. When operating with contracts for difference the liquidity depends on the month of traded contract and the leverage is smaller. The futures market also tends to have longer bearish periods and the trading sessions are restricted by a limit up/down rule. The forex market offers the option to short-sell anytime.

Secondly, forex brokers provide stop-loss and limit orders and the execution of trade operations is proceeded simultaneously. Although the loss of money can be controlled, slippage may occur in case of important news. Slippage is something common on the futures and stock markets as the execution price due to the open-outcry system. When trading stocks, the participants can sell short with an uptick and in the market of futures there is a limit rule for the contract value. In comparison,on the forex market a sale of currency pair can be executed anytime.