Should brokerages focus their efforts on broking shares or cryptocurrencies?
The latter has been brokers’ favorite toy to talk about in the last two years, but this is a long-term game and only the strongest and most patient brokers will survive to reap the rewards.
This article outlines key differences between the stock markets and the crypto markets, which should help brokerages understand where to allocate their funds for best effect.
Crypto market crashes vs. stock market crashes
Investors look at the recent falls in the crypto and stock markets through the same lens and expect a crypto bull run similar to those stock market investors enjoyed till now. However, there are critical differences to note.
For one, studies show that the latest crypto bull run was largely driven by price manipulation which was amplified by the media and investor reactions. There were organized pump and dump groups, and downloadable software such as ‘Quatloo Trader’ that allow investors to easily manipulate prices.
These issues have not gone away and having a decentralized structure means the markets are still susceptible to market manipulations. So, the market decline is a result of traders realizing that this, among other events, has happened.
Stock markets on the other hand are a function of how company and economic fundamentals are doing. President Donald Trump’s blitzkrieg victory and swift economic policies led to strong economic growth and market confidence that led the stock markets to rise in the first two years of his presidency.
The recent crash is indicative of the diminished confidence that investors have in the stock market and global trade.
Understanding the decline in markets is key to understanding future bull runs which in the near term are more likely to come for the stock markets rather than the crypto markets.
Where the masses are investing
Unlike the stock markets, which are highly regulated, vigorously covered by the media, and has institutions and retail investors participating; the crypto market still has a long way to go before the masses truly participate in crypto trading in a safe and reliable manner.
The uncertainty in the future of Cryptocurrencies remains a huge barrier for the masses, and brokerages cannot count on cryptocurrencies to become a reliable asset like forex, shares, or commodities any time soon.
A pointer to the reliability of the crypto markets could be indicated by the amount of pension fund investments pouring into cryptocurrencies. But there’s an awful lot of regulatory ground to cover before the general public will participate in this market.
Information, information, information
Traders evaluate their trades with technical indicators, market events, data, and financial analysis. These information sources are time consuming which is why Fintech companies are taking advantage of this opportunity to make information more accessible and actionable.
Forex traders use economic events, and stock investors use fundamental analysis and other methods to decide how to trade, but all in all, investors in these markets have plentiful and reliable information.
Cryptocurrency traders on the other hand have almost no reliable information; Fake news, lack of historical data, lack of Liquidity , and manipulated prices are making life very difficult for crypto investors. It’s no joke that traders are better off ‘Hodling’ and forgetting about their coins – only to one day find out it’s worth 1000% more.
Information about the stock markets is highly reliable and consistent, which is why companies like TipRanks develop technologies that distill big data from online media into stock research tools for investors to use in their stock analysis.
Even though the stock markets are tumbling right now they’re here to stay, and there are many indicators to show for it. Cryptocurrencies on the other hand have a long way to go before they become an adoptable trading asset like stocks. Brokerages should compare and decide what fits their strategy and prepare accordingly.
Disclaimer: The content of this article is sponsored and does not represent the opinions of Finance Magnates.
The latter has been brokers’ favorite toy to talk about in the last two years, but this is a long-term game and only the strongest and most patient brokers will survive to reap the rewards.
This article outlines key differences between the stock markets and the crypto markets, which should help brokerages understand where to allocate their funds for best effect.
Crypto market crashes vs. stock market crashes
Investors look at the recent falls in the crypto and stock markets through the same lens and expect a crypto bull run similar to those stock market investors enjoyed till now. However, there are critical differences to note.
For one, studies show that the latest crypto bull run was largely driven by price manipulation which was amplified by the media and investor reactions. There were organized pump and dump groups, and downloadable software such as ‘Quatloo Trader’ that allow investors to easily manipulate prices.
These issues have not gone away and having a decentralized structure means the markets are still susceptible to market manipulations. So, the market decline is a result of traders realizing that this, among other events, has happened.
Stock markets on the other hand are a function of how company and economic fundamentals are doing. President Donald Trump’s blitzkrieg victory and swift economic policies led to strong economic growth and market confidence that led the stock markets to rise in the first two years of his presidency.
The recent crash is indicative of the diminished confidence that investors have in the stock market and global trade.
Understanding the decline in markets is key to understanding future bull runs which in the near term are more likely to come for the stock markets rather than the crypto markets.
Where the masses are investing
Unlike the stock markets, which are highly regulated, vigorously covered by the media, and has institutions and retail investors participating; the crypto market still has a long way to go before the masses truly participate in crypto trading in a safe and reliable manner.
The uncertainty in the future of Cryptocurrencies remains a huge barrier for the masses, and brokerages cannot count on cryptocurrencies to become a reliable asset like forex, shares, or commodities any time soon.
A pointer to the reliability of the crypto markets could be indicated by the amount of pension fund investments pouring into cryptocurrencies. But there’s an awful lot of regulatory ground to cover before the general public will participate in this market.
Information, information, information
Traders evaluate their trades with technical indicators, market events, data, and financial analysis. These information sources are time consuming which is why Fintech companies are taking advantage of this opportunity to make information more accessible and actionable.
Forex traders use economic events, and stock investors use fundamental analysis and other methods to decide how to trade, but all in all, investors in these markets have plentiful and reliable information.
Cryptocurrency traders on the other hand have almost no reliable information; Fake news, lack of historical data, lack of Liquidity , and manipulated prices are making life very difficult for crypto investors. It’s no joke that traders are better off ‘Hodling’ and forgetting about their coins – only to one day find out it’s worth 1000% more.
Information about the stock markets is highly reliable and consistent, which is why companies like TipRanks develop technologies that distill big data from online media into stock research tools for investors to use in their stock analysis.
Even though the stock markets are tumbling right now they’re here to stay, and there are many indicators to show for it. Cryptocurrencies on the other hand have a long way to go before they become an adoptable trading asset like stocks. Brokerages should compare and decide what fits their strategy and prepare accordingly.
Disclaimer: The content of this article is sponsored and does not represent the opinions of Finance Magnates.
FXIFY Celebrates 1 Year Anniversary: Establishing Itself as an Industry Leader
Network, Learn, Grow | FMAS:24
Network, Learn, Grow | FMAS:24
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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