Anbbit Learning| Characteristics and Differences of Cryptocurrency, Forex and Stock Trading

3 min readFeb 5, 2021

It is very common that traders can be good at trading in several fields. They must be very familiar with the characteristics of every field so that they can make the trading strategies for each field. However, some people only catch on one of the trading fields like cryptocurrency, forex, and stock trading. This article will introduce the characteristics and differences among these three fields.

Distinctive features of each market

Traditional Stock Market

The traditional stock market is the most well-known of these three markets for neophytes. It is open five days a week except for Saturday and Sunday. It features a daily raising limit, low market volatility, and high transaction costs. Moreover, neither the use of leverage nor short selling is possible. This market can easily be manipulated by major investors.

In stock markets, there exists an informational asymmetry between the inside. Insiders have the access to critical information sooner than the outsiders, which allows them to buy before rallies, or sell before selloffs.

Anbbit learning | Stock market — Anbbit Learning — Stock market

There is a high insurance deposit if you want to buy stocks at any U.S. broker dealer, which will provide peace of mind to stock investors.

With the stock market, traders are guaranteed by strict investor protection laws in many countries.

Forex Market

The forex market is also well acquainted and favored, by traders and investors. It is also open five days a week, 24 hours a day, but has no raising limit and daily average market volatility of 1% (anything over 1% is considered very volatile).

The forex market is one of the largest financial markets around the world. As the Forex market consists of the world’s global financial markets, there is an unlimited supply of currencies available to trade. Also, because of its high liquidity, Forex markest has more participants and they can trade even large volumes of currencies.

Users need to care more about the political and economic news as the strength of a nation’s economy as well as its international relationships because the values of its currency will volatile due to these factors.

Besides, it is impossible that one single trader can make the influence Forex market like the stock market or the cryptocurrency market.

Bitcoin Derivatives Market

The Bitcoin derivatives market is the newest but most rapidly developing of the three markets. The digital currency & derivatives market’s main features are its seven trading days a week 24 hours a day, absence of raising the limit, and a high daily average market volatility (1%-10%).

It is especially suitable for small investors for short-term fast arbitrage. Moreover, it boasts relatively low transaction fees and supports long/short trading. It is more open and freer compared with the stock and forex markets.

As opposed to the much more experienced and famous stock and forex markets, the crypto and Bitcoin markets are relatively new, yet unregulated, and not as big, but they also offer much higher earning potential, are easier to enter, as a growing number of assets, and has seen a user base grow by +30% per quarter in the last couple of years making it the fastest-growing market by far.

Comparison of Stock, Forex & Crypto Markets