What is the difference between Futures and FOREX?
These are the key differences between Forex and Futures trading –
The Forex market is definitely different from the Futures exchange in many ways. On the other hand, equally these market deal with financial tools and depend on the theory of the price movements of the underlying asset.
In Forex affiliate, the Forex market is based on currency pair price movement and is there only for the use of trading currencies. Futures trading on the other hand are generally concerned with the trading of future contract based on assets and commodities.
The Forex market has high liquidity while the Futures market liquidity is relatively small. In the Foreign exchange market trading are no commission like in the Futures market and as a substitute on the spread.
In the case of Forex the essential asset is always a currency pair and in Futures it can be any underlying asset that is tradable.
Currencies are the money that represent the monetary system from different countries. For example; the Japanese Yen, Canadian dollar, Brazilian Real, Swiss Franc, etc. Futures trading of currencies is done in trading pits, where you are trading those currencies today, but for future prices. FOREX trading is trading actual currencies at today’s exchange rate with banks. All trades are done through brokers or market makers.
Currencies are the money that represent the monetary system from different countries. For example; the Japanese Yen, Canadian dollar, Brazilian Real, Swiss Franc, etc. Futures trading of currencies is done in trading pits, where you are trading those currencies today, but for future prices. FOREX trading is trading actual currencies at today’s exchange rate with banks. All trades are done through brokers or market makers. There is considerable exposure to risk in any off-exchange foreign exchange transaction, including, but not limited to, leverage, creditworthiness, limited regulatory protection and market volatility that may substantially affect the price, or liquidity of a currency or currency pair.
