Currency Futures vs. Forex
Both currency futures and forex are based on foreign exchange rates; however, there are many variations between the two:

The forex spot market is the greatest market in the world. Currency futures exchange at a fraction of the volume, with many forex futures contracts trading beneath high extent and good liquidity.

Currency futures are exchange-traded and are regulated like different futures markets. Forex has much less legislation and buying and selling is carried out over the counter thru forex dealers (there is no central marketplace for forex).

Currency futures can be traded the usage of modest leverage; forex offers the capability to change with a excellent deal of leverage, main to large wins and, of course, massive losses.

The tax remedy for income and losses incurred from forex futures trading and forex trading may additionally differ, relying on the particular situation.

Commissions and charges differ: currency futures generally contain a fee (paid to the broker) and different a range of alternate fees. Though foreign exchange traders do not pay these commissions and fees, they are situation to exchange price spreads through which the foreign exchange supplier profits.

Investors and merchants interested in collaborating in the overseas exchange market have options. Forex and forex futures offer merchants unique motors with which to hedge or speculate. The currency futures market is similar to different futures markets and provides participants a means of entering the overseas exchange market with larger law and transparency.