Trading stocks or foreign currencies is something anyone with some capital to invest can do as a way of trying to make a profit off of their existing money. Whether your capital is large or small, by trading wisely you can have an interesting (although risky) way to use your money that can result in a secondary income stream for you. Choosing between stocks and forex, however, can be a difficult decision, as both take a lot of focus to really get to grips with and it is best not to split your attention between the two if you don’t really know what you are doing!
However, there is one very big difference between stocks and forex that often makes online forex a much better choice for people who already have jobs or run businesses and want to do this on the side - the trading hours.
Stock Trading Hours Can Be Difficult to Work Around
If you work conventional business hours, then unfortunately, so does the stock exchange, meaning you’d have to do your day trading at the same time as your job. This obviously isn’t ideal, and even if you do have the free time, having all of your day free to follow what is happening with the markets can be hard to pull off even when you’re not that busy at work - you take one phone call or step into a one hour meeting, and all kinds of opportunities could be lost to you (or at least, that is the way it feels). You can try working with a stock exchange in a different time zone to you, but the rigidity of the trading hours can still be difficult to work around if trading isn’t your main activity.
24 Hour Trading with Forex
With forex, trades don’t happen within one exchange in one country as they do with stocks, because obviously the market is based on exchanging currencies from different countries. This means that there can be no fixed business hours, because so many time zones are involved. What this means as a trader, is that whatever time you are free for a session of trading, the market will be open and active. The only exception to this is weekends, with trading stopping on a Friday evening and resuming again on Sunday night.
Planning Your Sessions
When you are thinking about forex, it is best to work in GMT even if you are not based in the UK, because this will help you follow all of the international things that are going on without having to do constant time zone adjustments. When you have planned which currency pairs you are interested in, you will need to plan a session that suits you, and understand what time it is in the countries relevant to your pairs. Look out for tools to help you with your session management.
Forex has a lot of benefits but for busy people, one of the most important advantages it has over the stock market is being able to be far more flexible about your trading sessions when day trading.