The foreign exchange market also known as forex has unique characteristics that set it apart from other markets like futures, equities, etc. Those differences between the forex market and other markets provide many advantages which traders can benefit from on a day to day basis. Some see the foreign exchange market as very similar to other financial markets, but there are a number of differences which distinguish forex from other markets.
Trading hours is one of the differences between the forex market and other market. All over the world stock markets are operated for 8 hours a day and the time of operation varies between each country, but in the case of the forex market it is operated day and night on the basis of three shifts per day. Someone who wants to trade in the forex market can make a transaction at any time of the day or night.
Taking a look at stock markets we will see a combination of various stocks from a huge number of industries whereas in the forex market the combination of currencies is extremely low. This helps forex traders to trade with confidence and helps them to concentrate on combinations of currencies which can result in profits. Any currency in the forex market will not fail overnight whereas with stocks there are chances that some companies can fail without notice.
Trading forex is without commissions and no expensive fees or licenses. The cost of trading forex is the spread between the buy and sell price which is always displayed on your screen. When trading equities or a futures contract you often have to pay the spread along with a commission to a broker while not including a data charge for a price stream and charting.
Every time a stock is sold a middleman, may it be a broker or some other entity, is always standing between buyer and seller. They make money just to facilitate the trade. This is not the case with forex trading. In the forex market a trader can buy or sell directly by spot trading because the forex market is not centralized. Besides most forex brokers don't require additional transaction fees or even charge a commission.