Foreign exchange and precious metal transactions are two common types of investment transactions in the market. Foreign exchange transactions are mainly based on trading foreign currency pairs, while precious metal transactions mainly include gold, silver, and copper with investment value.
There are many differences between foreign exchange and precious metals, and of course there are many links. Here I will mainly introduce the difference between foreign exchange and precious metals.
First, the precious metal trading products are relatively single, and it is easier to analyze using technical means. Investors only need to analyze the next fluctuation direction of precious metal prices. Foreign exchange transactions are different. There are many foreign exchange currency pairs available for trading in the market. For example, FXCM can trade more than 40 currency pairs on a single platform. Investors must not only analyze the direction of foreign exchange movements, but also choose the right one. Trading foreign exchange currency pairs is more complicated.
Second, foreign exchange and precious metals are investment products with relatively large fluctuations, especially when doing international spot transactions, the exchange rate fluctuates particularly large. Under normal circumstances, the daily volatility of precious metals is greater than that of foreign exchange. Of course, the risk will be greater. If you make a profit, you will make more profits. Investors consider the stakes themselves.
Third, the foreign exchange market is the world’s largest market, and its daily trading volume is more than trillions, far surpassing the precious metal market. This determines that no institutional bank in the world can conduct a thorough review of the foreign exchange market. Control, investors can freely trade in the foreign exchange market. The probability of the gold market being controlled is also very low.
Fourth, both foreign exchange and gold can be traded 24 hours a day. Under normal circumstances, the maximum leverage available for foreign exchange is significantly higher than that of precious metal products.