The profit of forex compared to currency futures is considerable. The difference between the two instruments ranges from truth-seeking realities such as the history of each, their objective viewers and their interest in modern forex markets, to more concrete issues such as transaction costs, margin requirements, access to liquidity, ease of use and technical and educational support available. through sources of each service. These differences are outlined below:
More volume = improved liquidity. The daily futures volume on the CME is now more than 2% of the volume that every day in the Forex markets . Incomparable liquidity is one of the many benefits that forex markets offer more currency futures. Truth told this is old news. Any currency professional can tell you that cash has been king since the dawn of modern currency markets in the early 1970s. The current news is that individual dealers from every forex risk profile are now fully entitled to take advantage of the opportunities offered by the forex markets.
Forex markets offer a stricter bid to offer increases than currency futures. By converting the futures costs into cash, you can willingly see that in the USD / CHF example the reversal of the futures sale price of .8989 – .5897 results in a currency price of 1,6958 – 1,6966, 8 pips versus the 5 pip increase available on the currency markets.
Forex markets offer a greater benefit and lower margin tax than those in currency futures. When currency futures are traded, buyers have one margin for "day" buying and selling and another for "overnight" situations. These forex margins can differ depending on the company size. When trading money markets you have access to the same margins day and night. Certainly, trading by margin increases both your fx profits and your losses.
Forex markets use easy-to-understand and globally used terms and quotes. Currency futures quotes are inversions of the present value. For example, if the cash price for USD / CHF is 1,7100 / 1,7105, the corresponding future is 0.5894 / 0.5897; a method that was only followed within the limits of futures trading.
Currency futures have the additional difficulty of having a forex portion that takes into account a time factor, interest rates and interest rate differences flanked by different currencies. The forex markets do not need such changes, mathematical manipulation or thought for the interest rate factor of futures deals.
Forex transactions made through FOREX.com are free *. Currency futures have the extra baggage of trade commissions, transaction costs and depreciation costs.