The stock market is the first market that all of us have known about. In the early 1970’s a new
market came to be. That market is the foreign exchange market, more commonly known as
Forex. There are several key differences between the two markets. It is important to
understand that and to also know that your knowledge in one market doesn’t necessarily
translate to the other market if you are considering investing in it.
The stock exchange market is regulated by the Federal Trade Commission. They make sure
that certain licensing and rules are followed by traders on the stock exchange. Each country
has a governing board for regulating this. When you trade on the Forex market there is no
overseeing regulator for that. It is an international market and not governed by any specific
body. That means that investors have to be extra cautious and wise so they protect their
Stock exchange markets are physical places that you can go to. Foreign Currency exchange is
done through computers and the internet. You will not find an active pit like we see with Wall
Street trading. What you will find are people behind their computers studying what is going on
across the world.
The Forex market never sleeps. There is no specific day for trading. Depending on what type
Foreign Currency trading you want to do it can be done twenty four hours a day. With the stock
exchange market there are specific hours for trading each day. That is a key difference.