Differences between Forex and Options
Forex | Options |
Largest and most liquid market in the world | Liquidity depends on underlying asset & expiry date |
24-hour trading action for 5.5 days a week | Not 24-hour. Varying trading hours based on the exchanges |
Easier to calculate stop beforehand | Difficult and unreliable to place stops on underlying asset |
Minimum slippage and order errors | More room for slippage due to lack of liquidity |
100:1 leverage on standard-sized accounts | Leverage depends on the type of option transaction you want to engage in. Selling Naked Calls or Puts generally requires a huge amount of margin |
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