Forex, also known as currencies, FX or forex trading, is a decentralized global market of all currencies that are traded all over the world. This market is the largest and most liquid in the world, with a daily volume of operations that exceeds $ 5 trillion. The other stock markets in the world as a whole do not come close to this. But what does this mean? Take a closer look at forex trading and you will find interesting trading opportunities that are not available in other investments.
FOREX TRANSACTION: EVERYTHING IS IN THE EXCHANGE RATE
If you have ever traveled abroad, you have made a transaction in forex. Travel to France and convert your pounds into euros. When you do this, the exchange rate between the two currencies – based on supply and demand – determines how many euros you will get for your pounds. And the exchange rate fluctuates continuously.
WHAT IS FOREX? What is forex? video1: 54
On Monday one pound could give you 1.19 Euros. On Tuesday 1,20 Euros. This small change may not seem like a big deal. But think about it on a larger scale. A large international company may have to pay foreign employees. Imagine what you could do to the bottom line if, as in the previous example, changing one currency for another costs more depending on when you do it? These few cents add up quickly. In both cases, you as a traveler or business owner may want to keep your money until the exchange rate is more favorable