Forex vs Day Trading Differences and Similarities

Day trading refers to the opening and closing of trades within a single trading day. Meanwhile, forex is a trading instrument that deals with the exchange of currencies to make a profit and can be traded short term and long term.

Continue reading our day trading vs forex guide to see which of these suit your investment needs and how you can begin trading with CAPEX today.

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Roy Connor
Author:
Roy Connor
Last Updated on:
06/05/2023
Topic:
Trading
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Excellent customer support

Having excellent customer support is extremely important because you’re bound to have queries while investing in a new platform. Here at CAPEX, we offer traders active customer support through phone, email, and live chat. You can get in touch with our support team 24 hours a day, five days a week – plus, we have a dedicated FAQ page where we’ve answered the most commonly recurring questions for your ease and convenience.

Smooth and user-friendly trading platforms

Trading on a platform that is complicated or hard to understand leads to a poor trading experience.

Here at CAPEX, we have two unique trading platforms- CAPEX WebTrader and MetaTrader 5. Both our platforms are highly intuitive and extremely user-friendly. Our platforms’ simple user interface allows beginners to easily begin their investment journey and continue trading efficiently. Not only is everything neatly aligned and just a click away, but you can also install our trading applications to access your trades from anywhere.

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What is day trading? Day trading 101

As the name suggests, day trading is a popular form of trading in which traders buy and sell financial instruments online in the period of a single day. Most day traders make profits through small price fluctuations. Since day traders don’t hold onto assets for longer periods, the risk level isn’t too high. Although, day trading requires constant attention and is more suitable for those who can invest time as well as capital.

What are the best instruments for day trading?

The best thing about having a day trading strategy is that you can make use of short term price movements on any instrument you like. If an instrument is volatile, it’s more suitable for day trading because then day traders can benefit from the price movements.

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Pros and cons of day trading

There are some advantages to day trading:

  • You avoid the risk of holding an asset overnight.
  • There are no overnight charges.
  • Endless trading opportunities, especially in volatile markets.
  • It’s thrilling and fast-paced, so traders might find it exciting.

However, there are a few difficulties as well:

  • Since you don’t hold an asset overnight, you miss out on many opportunities.
  • The returns per trade are usually small due to the short-term investment.

What is Forex trading? Forex trading 101

Forex or foreign exchange is the world’s largest decentralised market, where people exchange currencies in the hope of capitalizing on market movements. Forex traders exchange currencies in order to benefit from the shifting prices of currency pairs. For instance, if AUD seems to be rising in value while GBP seems to be falling, a Forex trader will trade GBP/AUD in order to profit from the price movement.

While Forex trading is simple and can be done with high leverage as well, the trading options are limited because nearly the entire Forex market is made up of 8 major currencies, including USD, GBP, & AUD.

Day trade CFDs at CAPEX.com

With us at CAPEX, you can day trade over 5000 instruments through CFDs. Whether you want to invest in the Forex market, stock market, or crypto market, you can do so with ease on our trading platform.

Pros and cons of Forex trading

Trading Forex has a few advantages:

  • Simple instruments with good potential returns.
  • There are a decent variety of trades to invest in.
  • Entering into the Forex market is easy.
  • You can trade Forex through CFDs.

Nevertheless, there are also some drawbacks:

  • High volatility means you can lose money.
  • There are several factors that can affect a currency’s price.
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Day trading vs Forex: Differences and similarities

The main difference between day trading and Forex is that Forex is a trading instrument that deals with currency exchanges, whereas day trading is a form of trading or a trading strategy in which you buy and sell instruments in a single trading day. The similarity between day trading and Forex is that they’re both effective tools for an investor who wants to trade with reduced risk.

Here at CAPEX, you can day trade CFDs on a wide range of instruments, including Forex. Not only does this allow you to avoid higher risk, but it’s also a great way to obtain experience in a number of markets and build a trading portfolio without emptying your pockets.

In contrast, Forex can be used as long-term investments as well. Some traders like to buy and HODL currencies in the hope that they’ll make decent profits in a few years from now. HODL is an acronym for “hold on for dear life,” suggesting people not to impulsively sell when the price of a cryptocurrency sees a significant variation.

 

Factors influencing Forex Trading

Graph Shape

Important political developments

Tax changes

Consumer & producer preferences – CPI or PPI reports

Interest Rate Decisions - Bank of England MPC Announcements, Fed Interest rate Decisions, etc.

Other market-related FX news

Visit our Special Articles page for the latest market news on cryptos, stocks, indices, and more!

Day trading vs Forex - How should you begin your investment journey?

If you’re looking for an investment that doesn’t demand your constant attention or want to invest for longer periods of time, we suggest exploring Forex further. However, if you want to play it safe and would like to invest for shorter periods of time – despite the fact that it requires more attention – day trading could be the right strategy for you.

No instrument or strategy is better than another, and each strategy and the trading instrument has its pros and cons. So, you need to see which trading instrument and which trading strategy aligns perfectly with your trading goals in order to decide how you can begin trading.

Here at CAPEX, you can day trade Forex through CFDs along with numerous other instruments.

Not only is this a great way to diversify your trades and obtain trading experience in a number of markets, but it’ll also help you decide which market and trading style suits you and which doesn’t.

 

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Trading with CAPEX.com

The great thing about CFD trading online is that you can do it anywhere there is a secure internet connection. Inevitably, this means that mobile trading has proven particularly popular as traders can conveniently open and close positions from their mobile or tablet as and when it suits them.
Discover the functionality to ...
Trade more than 5,000 CFDs
Trade more than 5,000 CFDs
Manage your investment horizon
Manage your investment horizon
Set take-profit or stop-loss limits
Set take-profit or stop-loss limits
Open short and long positions
Open short and long positions
No fees for opening and closing positions
No fees for opening and closing positions
Trade with and without leverage (StoX)
Trade with and without leverage (StoX)
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Benefits of day trading with CAPEX

  • We offer over 5,000 tradable instruments, allowing traders to diversify their trades with ease.
  • CAPEX offers the lowest trading costs, allowing traders to keep most of their profits to themselves.
  • Our trading platforms CAPEX WebTrader & MetaTrader 5 (MT5) are user-friendly, highly intuitive, and easily accessible – the perfect platforms for day traders.
  • We offer customer support seven a week through phone, live chat, and email. So, if you’re ever stuck, you can simply get in touch, and our support team will resolve your issue.
  • Our webpage and trading platforms have several learning tools, including an online trading school where you can learn how to day trade effectively.
  • We offer excellent demo trading accounts where traders can practice trading until they feel confident enough to actually invest.

 

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Verify

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Send over your documents and verify your account.
Deposit

Deposit

Login into your CAPEX.com account and deposit money.
Trade

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Start trading with CFD’s and over 5000 other instruments.
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How to sign up with CAPEX today – Begin your trading journey with ease

Signing up with CAPEX is a straightforward process. All you have to do is visit our sign up page and do a quick sign up with your email address, name, and a few other details. Then you’ll be redirected to our trading platform, where you’ll have to re-enter a few more details, which include your salary, taxation, and credit history.

Lastly, we’ll ask you to take an assessment that is designed to assess your trading skills and knowledge. According to the assessment results, you’ll be allowed to trade within your capacity.

Once you’ve completed your signing up process, your account will be verified and ready to use shortly. You can begin your investment journey as you please; however, we do recommend that you try out our day trading demo account beforehand.

Final thoughts – Day Trade Forex at CAPEX

While Forex is a popular financial instrument and is a great way to invest your money, day trading is an effective trading strategy that allows traders to trade with minimal risk and is extremely thrilling for traders.

Whether Forex or day trading is the right trading instrument and strategy for you depends on what you’re looking for in an investment. If you want to make short term investments with lower risk and lower capital returns – day trading is the right choice for you. Meanwhile, if you want more flexibility and would like to trade with less thrill, then you can simply invest in Forex without limitations.

However, day trading Forex is a great way to begin your investment journey. If you want to give it a try, you can simply hop on to our platform and sign up for a CFD trading account today.

Day Trading vs Forex – FAQ

Is forex harder than day trading?
Can day trading make you rich?
How can I day trade Forex profitably?
Is day trading risky?
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