Securities vs. Forex

Securities or a security is typically a certificate or an electronic book entry of ownership of a portion of a company as printed or allocated by an issuer. The issuance of securities are regulated under the jurisdiction of securities commisssions in their registered regions: provincial, state or country.

Foreign Exchange is the buying and selling of currencies on the open market. Foreign exchange or forex is a $3.2 trillion dollar, unregulated market built on the premise of predicting short term movements in the values of currency pairings.

Why pick securities over forex? There have been many recent current events that work for and against both types of openly traded investments. One very current and unfortunate event occured in New York just over a week ago which in turn affected many unsuspecting investors around the world. The fraudulent behaviors of a company called Razor FX,for example where those in control of the funds stole $68 million US from investors using a ponzi scheme.

Securities on the other had have taken a huge dip as the markets in the past week have hit extreme downfalls, as much as 300 point hits, with the speculation of recession in arms length.

The key differences between forex and securities is obvious and simple. Forex is unregulated leaving the gap for unethical privately managed fund managers to take advantage of investors who trust their funds are being used by professional investors. Also, private opportunities are often controlled by very few people. As we all know from the "Lord of the Flies" one head with full control leads to chaos. Responsiblity must be and should be share amoung the masses. With that said, the securities market is regulated, and with companies registered in the United States, they operate under the strictest of accounting standards and public transparency. Further, corporations are not controlled by one head, but by a board of directors, an elected CEO, and shareholders who together dictate the usage of funds. The usage of funds is made public knowledge in respect to securities regulation, making fraudulent activities difficult to achieve.

So which way is the better way? Securites is the way in my opionion as there's a lot of opportunity for returns if you know how to read the charts. One such company that I've been watching is traded on the Nasdaq. It's called Fine Line Holdings (FNLH), a penny stock with huge opportunities as they seem to be acquiring a range of assets, among them are wellness spas, an animations/cartoon company, and $125,000,000 worth of land in Cancun, Mexico.