Crypto vs Stocks vs Forex – The 7 Differences

What are the differences between crypto vs stocks vs forex and which is more profitable? You can make money through the financial markets in a lot of ways these days but all of the strategies and options for trading may not be suitable for everyone.

Keeping that in mind, you will need to compare forex trading, crypto trading and stock market investing to find the easiest and most reliable way to make money.

If you have no clue about it, this article will help you to make a more informed and educated decision by knowing the differences between the three options.

Each of these three types of investments is differentiated on the basis of their distinctive trading characteristics as well as that of the respective markets.

This will provide you more knowledge over and beyond the basics and know all the critical aspects of each of the three types to successfully distinguish the best trading option for you.

7 Differences Between Crypto vs Stocks vs Forex

Differences Between Crypto vs Stocks vs Forex

If you are new to trading in the financial world, you would probably be wondering about the most profitable type of trading for you.

In forex, crypto, and stock trading, each has the odds stacked in your favor as well as against you. Check out Tax Implications of Crypto and Stocks.

That is why you will need to compare between these three options for trading in the financial market to know much more than the basics about the market and trading and choose any one of them that seems to be the most profitable.

1. Market

Forex: The forex market is similar to the crypto markets in one particular aspect – it allows the users to access it all through the day. However, it operates 24/5 and not 24/7.

However, the retail traders cannot access it for 24 hours a day. There are different factors that make forex or the foreign exchange a lot more valuable. A lot of trades are made over these exchanges all over the world.

It is primarily due to that reason that it offers so many diverse opportunities to the people to invest and trade with. However, users should be wary of the market because it is not easy to trade on forex.

They must first familiarize themselves with the forex market as well as the bots that should be used in combination to ensure success.

Crypto: The crypto market is also not very easy to go through like forex but unlike it, the crypto market is comparatively new in this sector. On the other hand, this market has got a lot of growth potential which offers better returns in comparison to the stock markets.

Apart from that, the crypto markets never close. It is the most significant difference between this market and forex and stock markets. It is open 24/7 for 365 days. The diverse range of products in this market provides a wider range of investment avenues.

With the use of the latest technologies and tools, this market is quite promising and provides outstanding returns on investment if traded and invested cautiously.

Stocks: The stock market is quite efficient no doubt but it needs the people to trade more systematically and create much better and more efficient plans. The reasonable use of trading bots and quantitative funds in this sector is noticed of late which makes this market even more efficient.

This has led to the use of computerized plans and programs by the financial institutions. In fact, as of now, automated funds and quantitative companies account for a major share of the stock market.

High-frequency trading, computer trading, and long term management of capitals are a few significant aspects of this market but sadly it does not produce returns that are above the average.

2. The Tools

Forex: When it comes to the use of tools for forex trading, the bots used in this market typically can work till the time they can no longer. Experts think that this is due to the fact that more and more users follow it.

The forex market also comes with a set of tools that the people should use for proper assistance but according to the experts, these tools should not be relied upon entirely.

These automated tools come with position management abilities, order placement abilities, and trade recognition ability. These are the essential attributes that offer better forex solutions.

These tools work on specific parameters such as reliability, technical analysis, and speed to help the users increase their chances of profitability by eliminating psychology and ensuring growth. This is due to the fact that these tools are designed specifically for the forex market.

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Crypto: The crypto tools, on the other hand, allow the users to have access to better deals and conduct automated trading. Better trading solutions can be deployed by using these tools that work uniquely and help the users to create and execute the most suitable strategies for a particular trade.

Based on advanced technologies, these price indicators and trading signals along with other tools use the best techniques to detect the price movements, the trends followed in the crypto market and also predict the future movements.

All these offer a much better opportunity to gain more whether you are into swing trading or gain leverage from arbitrage. The trading bots used in the crypto scene can provide excellent returns when correct strategies according to the market are followed making the best out of the wide spreads.

Stocks: The tools used in the stock market include stock charts that help the users to analyze the market as well as an individual stock better. These tools also allow better portfolio monitoring and management after proper analysis as well as streamline the research process.

The market also uses other tools such as the Simple Moving Average which helps in better technical analysis and offers better price data and the Moving Average Convergence and Divergence tool that helps to identify the new trend in the market or know whether it is bullish or bearish.

The Relative Strength Index helps to gain knowledge on the momentum and magnitude of the latest price changes to know whether a product is overbought or oversold.

There is also a complex tool used in the stock market – the Parabolic SAR – by the experts. This tool helps in detecting the price direction and accordingly it determines the entry and exit points.

3. Trading

Crypto: When it comes to trading, in the crypto world, there is no doubt that you can make big money, though it is not an easy or a quick process. This is because the crypto assets are highly volatile and therefore you stand a high chance to lose all your money if you do not trade cautiously.

Moreover, it is not possible to judge the exact value of a crypto asset and therefore this form of trading is considered to be highly speculative.

Forex: Forex trading, on the other hand, is relatively better than crypto trading and it offers much higher returns for a living than stock.

However, one of the most significant aspects of this market is that when you trade you are put up against a forex provider as well as the currency market. Therefore, if you do not trade well and cautiously you may not get the kind of returns you expect from it.

Stocks: Stock trading is far easier and more reliable than all but the problem is that it is not for those who want to make money and become rich quickly. In this form of trading, all you need to do is find a reliable company with adequate growth potential to invest in their stocks.

Also, you must hold their shares for a long time to make big money. However, not all stocks perform equally well and there is a chance of losing your money in this form of trading as well.

In spite of that, investing in stocks and shares is a much better option compared to crypto and forex in which you need to be glued to your computer screen.

4. Yield

Stocks: Though you can do well with any of the three, stocks are less likely to give you a high return. It can yield within the range of 1 to 2% a month provided you do not make some serious emotional mistakes while trading.

Also, consider the pros and cons of holding them for the long term and trading them more frequently, considering the tax implications.

Crypto: Cryptocurrencies, on the other hand, will provide you with much higher returns than the stocks but that will need some serious planning and risk tolerance when you put a large amount into it.

A move by one or two points can provide returns to the tune of 20% if you are very lucky. However, consider the tax implications as well as the consequences of a few dramatic events and upturns.

Forex: Forex trading will surely be the one to provide the highest returns if you can make the most out of arbitrage and scalping opportunities. You can make a lot of money by seeking out three or more different types of currencies coordinated with each other.

Whether you use a simple triangle trade or something that is even more complex with a few more currencies, making several trades will help you make out the best from the opportunities created by the discrepancies in currency comparison.

5. Investment

Stocks: As for the investments, stocks are usually considered to be cash flowing investments. It is easy to evaluate so that you can judge whether or not the price is good enough to purchase the stock or too high to look over.

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In stocks, it is not easy to generate alpha but it is possible theoretically, though the professional money managers will seldom do it on average. There are tens of thousands of stocks out there in the stock market and most of them are either overvalued or simply junk.

If only you have a proper understanding of your investment strategy and have a decent risk management experience, you will not lose in investing stocks, at least in the long term.

Crypto: As for the crypto, it not only disallows this opportunity but it is simply not considered to be an investment in the first place by several experts. Also, a few of them are Ponzi schemes.

If you do not know what that means, it is the process of alluring new investors and using their money to pay the existing ones. Making money from crypto investment is only possible when you are okay with the disproportionate risks involved in it and are ready to lose your money.

This is because you will not be able to predict for sure as to when exactly the bubble will burst, which is guaranteed to, because it has no intrinsic value, it is not backed up by any central authority, and is based on marketing simply.

Forex: The Forex investment is however more complicated but quite rewarding. This is because the currencies have a clear value and government power.

No miracles happen or are expected to happen in the forex market which is why the investors are not swindled, or charged excessively or disappointed.

However, small players in this market cannot generate alpha which means that your chance to make money is as good and high as losing them. However, if you aim for a long run, you may get quite lucky while investing in forex.

6. Characteristics

Crypto: Cryptocurrencies, the new asset class, is based on blockchain technology. This digital currency can be created and issued by companies, and even individuals.

This decentralized finance system eliminates the need for a middleman to trade or invest in. The coins are very divisive and have the potential to replace fiat currency one day.

Stocks: The stocks, on the other hand, are regulated and controlled by the government and the environment that ensures fair practice.

Buying of stocks gives you individual ownership of the company issuing it to the extent of the number of shares bought. These can be sold at a profit as and when the price of it rises.

Forex: The forex however is considered to be the most liquid financial asset just as the market itself which is also the largest one in the world. With trading volumes in trillions, you will have enough opportunities and avenues as a trader to buy and sell foreign currencies for a profit.

7. Uniqueness

Crypto: In the crypto market, there are mainly two types of traders. One is, who buys and sells the coins in a day on an exchange and the other one is who buys and holds them to sell them at a higher price later on, often called the HODLERS.

In this form of trading, traders can go short or long. Going short here means trading two currencies against one another, called pairing, speculating that one coin of the pair will fall in value.

The opposite of it is going long. This volatile market can gain in value significantly in one day and lose it all in the next. A few crypto coins are liquid, especially those with a higher market cap.

Though cryptocurrencies are usually susceptible to supply and demand, consumer behavior and other macroeconomic factors, it is however not impossible to speculate the changes in price of the crypto coins.

These coins can be traded from all over the world even though the crypto exchanges offer a low leverage often.

Stocks: As for the stocks, the price changes are often affected by the microeconomic as well as the macroeconomic factors both, such as the economic performance of the country as well as the consumer behavior.

Though the stock market is also volatile, the price movements are often slower than forex or cryptocurrencies. The liquidity factor of the stocks depends on the market cap and popularity of the particular stock which is why the blue-chip stocks are more favored in comparison to the other stocks.

Though you can buy stocks online, it is advised to buy them from the dedicated stock markets because these are more often than not subject to localized channels. Also, you can buy CFDs. A major part of the population buys stocks to hold them for a long time because that is the most profitable way.

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Forex: The Forex trading, on the other hand, can be made through different exchanges from anywhere in the world and you can go long or short, just as in cryptocurrencies.

There are different trading sessions in this market but the trading activities are the largest when these sessions overlap. The markets as well as the major currency pairs are very liquid and it offers the traders high leverage.

The market is also affected by the macroeconomic factors but in comparison to a crypto market the movements due to these events are not as chaotic. You can start trading forex with a low capital and the trading costs or spreads are significantly low as well.

Which is More Profitable – Crypto or Stock or Forex?

There is no perfect answer to this question, ideally. Even if you ask the investors in the respective fields, you will seldom get an answer that will be according to your liking.

Instead, they will speak about their choices and preferences. This means that it is all about personal preferences and alignment with the investment goals.

The main reason for this difference in opinion is that all these three investment vehicles differ significantly. Therefore, it is much better to decide for yourself as to choose the best option among the three different types.

For this, you will need to understand the market, the working process of each of the three investment avenues, and then determine which of the three types suits you the best.

To help you in this matter, you are advised to focus on specific parameters of choice which ideally include and are not limited to your risk appetite, preference, trading style, and your investment and financial goals.

However, it is good to remember that whether you indulge in trading crypto, stocks, or forex, you will need a significantly high level of commitment for all.

Apart from that, you will also need to create an action plan that is more effective and productive in order to be successful.

Also, you cannot do without proper risk management because investing in financial assets in any form, physical or virtual, involves a certain amount of varied risks.

However, if you still need to know which one among the three investment vehicles is more profitable, be informed that it is forex over crypto and stocks.

The simple reason behind this is that the forex market offers comparatively a higher level of visibility and transparency.

This market also offers a higher degree of leverage making it quite simple for one to make profitable trades and investments. The forex market will also allow you to make some money fast depending on your trading style.

Especially, if you are a scalper you can make profits in minutes by getting in and out of the market easily, though you can do the same while crypto day trading but not to the same degree of success.

However, do not take anything lying down and hope to be successful just because the forex market is considered to be more profitable by many or is suggested in this article.

As said earlier, it is all about personal choice and preferences and therefore you will need to conduct a thorough research, preferably on all the three different vehicles, in order to choose the best option you wish to follow and trade.

No matter whichever way you choose to make money, it is quite hard going.

Your chances of being successful in any of the three forms will be enhanced significantly if you demo for a while, say for about three months, and they go live through a good and reliable broker when you have full confidence in yourself. Patience and learning is the key to success here.

However, there is no harm in choosing a combination of two or all three, if you feel, that is. This will ensure that you enhance your chances of making profits even further by making the most out of the benefits offered by each of them.


When you ask which among stocks, crypto and forex is better to trade you will perhaps get biased answers. This article will offer you some knowledge about the differences between them to make the right choice based on your exact goals.