Business Telegraph

The Entrepreneurs

Cryptocurrency Trading vs. Stock Trading

  • Written by News Company



The goal of any professional trader is to diversify his investments in order to spread the risk across a bigger number of asset classes. As new industries emerge, so do new trading instruments, which is why today we will talk about a few advantages and disadvantages of cryptocurrency trading as compared to stock trading.


Advantages of cryptocurrency trading

  1. Volatility – in order to generate profits in the markets, traders desperately need volatility. In comparison to stocks, cryptocurrencies are more volatile, considering that liquidity is very low. Just to give you an example, the global cryptocurrency market cap is around $140 billion at the time of writing. In contrast, the Apple market cap exceeds $900 billion. It’s also important to mention that volatility acts like a „double-edged sword” since it can amplify gains and losses as well.

  2. Innovation – the blockchain technology had really managed to disrupt several industries in the past few years, which makes analysts anticipate it will be the building block of a new technological revolution. Since all cryptocurrencies exist thanks to the blockchain technology, we could see them more integrated into the economy as time goes by.


Disadvantages of cryptocurrency trading

  1. Liquidity – since it’s not as old as the stock market, the cryptocurrency market could still be considered in its early phases. As a result, liquidity is much lower, which leads to higher spreads, as compared to other asset classes. Low liquidity can pose some difficulties when it comes to trade execution. Your broker might not fill your orders with high precision and it will be tough for you to get in or out of the market when volatility is very high.

  2. Limited knowledge – the market is new so people had not managed to accumulate enough data in order to understand what moves the market up and down. The same principle of demand and supply is valid for cryptocurrencies as with stocks, but all the reasons that could impact demand or supply are yet to be found. Because of that, it will be hard to appreciate whether a particular cryptocurrency is valuable or not.


To conclude, as with any other asset class, cryptocurrencies have strong and weak points, which is why traders should treat them with caution. Although brokers like AtecsCapital, forex.com, and others had included cryptocurrencies in their instruments lists, greater attention to risk management should be allocated since the market could suffer sudden changes which might have a strong impact on valuation as a whole.

Entrepreneurs & Leaders

Sydney Pest Control Quick Traps Against Vermin Invasion – Effective, Fast, and Easy!

How can you be vigilant when it comes to rodent infestation? There might be one trying to sneak into your home rig...

Ozzy tyres 4x4 wheels review

The performance of a 4x4 vehicle depends to some extent on the wheels and tyres fitted on the vehicle. Hence the vehicle...

Genealogy Resources and How to Use Them Effectively

There are plenty of online and analog resources that can provide tutorials, further resources, and troubleshooting...

Redesigning Your Garden

Tired of looking through your kitchen window at the same drab garden? Are you feeling creative and have the desire t...

Five ways to help your child get a good night's sleep

It is a challenging factor for each parent to get the children on time to bed every night. Parents are dealing with ...

A Help Guide on Tow Truck Insurance

Do you have tow truck insurance requirements? If yes, then you have come to the right place. Reading this guide wi...

Businesses Must Not Ignore Men’s Mental Health

As COVID-19 takes its toll on the mental health of employees, workplaces must look to provide support Businesses ...

Things To Know About Electric Scooters

Ultimate electric scooters have been accepted as one of the most preferred modes of transportation. With the new t...

How To Choose Leather Watch Brands

Every accessory has its value and beauty to add on to the user using it. A watch, the most common accessory, is no...

Aerated Treatment Systems: The Best Alternative for Septic Systems

In rural areas with houses that are spaced widely apart, residents use onsite water treatment systems like aerated...

Would you be able to bring down business transfer expenses?

While you can agree to an online-based business account like TransferWise or PayPal or go with the great standard ...

Top 10 Office Desk Accessories You Must Buy

The design or set up of your office is one of the important factors affecting your productivity. Available space, ligh...

10 Female Inventors You Should Know About

We are all aware of the great and historic male innovators such as Alexander Graham Bell and Benjamin Franklin. Ho...

Startups to ‘explode' post COVID-19

Frenetic start up activity is imminent as business begins to adapt to a post COVID-19 economy, according to the ho...

New Tech Career Programs Opened Up For Thousands of Job Seekers

Randstad partners with veteran business WithYouWithMe to help Australians gain new tech skills Global leader in H...

6 Great Tips for Building a Custom Home You've Always Dreamed About

Building your own home is a great opportunity to create a customized space that suits your needs perfectly. Howeve...

10 Important Things to Consider Before Selling Your House in Perth

Have you been thinking of selling your house? It would help if you started to prepare as early as possible, ensuring t...

FIVE THINGS NO ONE TELLS YOU ABOUT BRACES FOR TEENS

Health is a fundamental concept of living. Without health, there is nothing. The term “health” refers to a state where...

SEVEN HOME IMPROVEMENT IDEAS ON A BUDGET

One tends to get bored with the same daily routine of going to work and completing household chores. After a tirin...

TIPS FOR STARTING YOUR OWN LAUNDRY BUSINESS

Not every apartment has all the items that one might need, and in such cases, a common man would see helplessness, but...

BENEFITS OF USING A COMMERCIAL LAUNDRY SERVICE

No doubt, we are living in a century where our lives revolve around various kinds of machines and gadgets. And the sol...

TOP IDEAS FOR PROMOTING YOUR SMALL BUSINESS

Are you wondering about doing smart promotion for a small business without breaking the bank? Well, there are a lot ...

TOP TEN HOME OFFICE UPGRADES FOR 2020

The outbreak of the COVID-19 pandemic has been the biggest highlight of the year 2020. It has drastically affected the...

DISRUPTIVE INNOVATION CAUSED BY SMALL BUSINESSES

Innovations that undermine the natural balance of resources and values ​​in the market are called disruptive innovat...



News Company Media Core

Content & Technology Connecting Global Audiences

More Information - Less Opinion