Forex Trading – Futures vs Forex

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Forex Trading – Futures vs Forex

The stock market can brag about its advantages over the futures market, like its advantages over stocks.


The forex market is the currency trading sites and also a largest most liquid market in the world due to nearly $5 trillion being traded daily. The forex market can cater to immense transaction sized and trading volumes that put other markets to shame. Stop orders can be executed and positions liquidated with little failure in the forex market.

The futures market, on the other hand, trades roughly around $30 billion a day with limited liquidity.

24 hour market

The market in Sydney opens trading at 5 pm EST.

The market in Tokyo opens at 7 pm EST followed by London opening at 3 am EST.

New York market then opens at 8 am EST then closes at 4 pm EST.

But before the trading at New York closes, the market in Sydney opens again making the forex market truly 24 hours open.

This opportunity allows traders to trade immediately based on either positive or negative news.

While in the futures market, imagine receiving news from Japan or the UK while the market is closed for the US futures, the following opening day could become a riot. Though the futures market is improving their liquidity, it is still not enough to catch up to the spot forex trading.

Minimal or no commissions

Due to the fierce competition of forex spot brokers, traders usually receive very low transaction fees and the best quotes.

Price certainty

The equities and futures market do not provide price certainty and the option to execute instant trades. While in the forex trading, you get price certainty and instant execution of trades.

Guaranteed limited risk

Position limits are available for use of traders to help manage risk. Traders set the limit according to the trader’s money in their account. This tool provides minimized risk as it will close positions should it reach the designated amount.

Meanwhile in the futures market, your account may liquidate large losses that exceed your account which makes you responsible for the deficit as a result.