Forex Trading, also known as FX Trading or by many as the Foreign Currency Exchange, is a financial market where is binary options the same as forex exchange person can trade national currencies in order to try and make a profit. Dollar will get stronger compared to the British Pound or the Euro.
Options Trading allows you to buy or sell options on large amounts of stock, futures etc. As with Forex Trading, you can leverage your buying power to control more stock or futures for instance, than you could have normally. However, there are differences between Forex and Options Trading. Many of the differences are described below.
Options trading is your ability to trade 24 hours a day, five days a week if you wish. The Forex Market is open longer than any other market. When you use the Forex Currency Trading System, you receive immediate trade executions. There is no delay like there can be in Options or for that matter other markets as well. And your order gets filled at the best possible price instead of guessing which price your order might get filled. Your order certainly won’t “slip” like it can with Options.
In Forex Trading, there is a lot more liquidity to help with “slippage” than there is in Options Trading. Forex Trading has the advantage of being more liquid than any other market, including Options Trading. With the average daily volume in the Forex Market reaching close to 2 Trillion, there is no comparison. This means when it comes time to trade, Forex Trades will be filled much easier than Options trades will. This speed means more potential profit. Forex or FX Trading is Commission Free because it is an inter-bank market which matches buyers with sellers in an instant. There are no middleman brokerage fees as with other markets.
There is a spread between the bid and ask price and this is where Forex trading firms make some of their profit. This means you can save money when you trade Forex compared to Options trading where there are commissions since you would be working with a brokerage firm. Online Forex Trading can give you much greater leverage than playing Options. However, with Options, you can also manage putt and call options in a way to greatly increase your leverage. Leverage can be very important when you know what a currency is going to do.