If you still confused what kind of trading is better, then you came to the right place. Now we make a simple review about the forex trading compared with a futures trading. As we know before on the previous post that forex trades have one great feature that is leverage, but if you trade without any rules then you can lose your money. For an example, let’s say you were a person who likes to trade with no rules, no strategy, no management principles, a reckless abandon person. The type of person above isn’t recommended but a forex trader has great benefits that even if someone with trading mind like described above, will never lose the money more than what he has put into the forex trading.
Different with Futures Trading, also called a Commodity Trading, a market that most people related with high leverage, you can never have a debit balance in a forex trading. So despite the bigger leverage related with forex trades, it is still arguably less risky than futures trading. Futures market are very often to sudden and dramatic moves againts you even you have a trading with protective stops. The position you have may be knock off at a loss and you will be unresistant for any resulting shortage in your account.
In forex trading, orders are placed quickly without slippage or partial fills, it is a great trading system. It all can happen because the forex market has a great liquidity, a 24 hour system, trading continuously, dangerous trading gaps and limit moves are not possible. There are many other advantages of forex trading such as there are no margin calls. For protection reason, if the account equity falls below the required level to hold the positions, the forex broker’s trading platform will close some or all of your open positions automatically. The account equity means the total floating value of the account. This automatic stop system are always working on your behalf so a debit balance can be prevented.