Forex, or FX, is a shortened term that describes the Foreign Exchange Market, a marketplace where the world's various currencies are traded. It is an interbank market which was created in 1971 when international trade transitioned from fixed to floating exchange rates. As a result of its incredible volume and fluidity, the FX market has become the largest and most significant financial market in the world.
Unique Characteristics Of Forex Success
Forex markets operate 24 hours a day, 5 and a half days a week.
Superior liquidity: the daily turnover of the FX market - over 4 Trillion Dollars - makes it easy to trade most currencies instantaneously
You can profit from both rising or falling markets
You can benefit from leveraged trading with low margin requirements and capital
There are standard instruments available to help you control risk exposure
Excellent Transparency: the Forex Market is transparent and not susceptible to manipulation or cornering
The exhange rate
Forex plays the indispensable role of determining global exchange rates. The exchange rate is the number of units of one nations currency that must be exchanged in order to acquire one unit of another nations currency. A market exchange rate between two currencies is determined by the interaction of the official and private participants in the foreign exchange rate market.
The main participants in the Forex market are: central banks, commercial banks, financial institutions, hedge funds, commercial companies and individual investors. Each sector participates for different reasons such as:
- Profit from fluctuations in currency pairs (speculating)
- Protection from fluctuating currency pairs which is derived from trading goods and services (Hedging)
With technological development, the World Wide Web has become a great trading facilitator, as it can provide individual investors and traders with access to all the latest Forex news, technology and tools.
Useful ResourcesInvesting your money
FXMISO is delighted to make a number of Forex Educational available to our Live and Demo clients. Our education starts from basic to intermediate to advanced. Start learning at your own pace.Learn More
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