What Is Forex?
Forex and FX are both abbreviations for “Foreign Exchange”; it may also be called the currency market, the foreign currency market, the currency trading market and etc. The Forex market is where banks, international corporates / organizations, governments, investors and traders come to exchange and speculate on currencies. Forex is considered as the world largest and most liquid-able market in the world with an average daily turnover of over USD $3.98 trillion dollar as the business days continues.
As we understands that Forex market is the origin market places for all activities that involves currency transaction, it is also commonly understood that there will be no central marketplace for the Forex Market; trading is instead said to be conducted “over the counter” unlike other investment such as stocks where there is a central marketplace with all orders processed like NYSE. All Forex currency pricing are all quoted by all the major banks and not all banks will have the exact same price. The brokers shall be taking the average feeds from all the banks or liquidity provider.
As the business transactions from all levels organizations from each country, currencies will be bought and sold just like any other commodities and its value shall increases and decreases depending on the economics movement of each nation; this is where Forex comes into place as the fluctuation of currencies price will be the main target for Forex investor, traders or fund manager to focus on for their investment as they place their trades between the currencies and gain their respective profits.