What Is Forex?

It may come as a shock to the investment rookie, but Forex is the largest market in the world. Forex is an abbreviated form of the term Foreign Exchange, or simply currency. These terms refer to the monetary value of one country’s money value (as measured by the country’s largest single-value denomination) and is usually measured in comparison to the unit of currency used by the country in which the investor is a citizen.

What is Forex

Foreign Exchange trading (also called Forex, FX or currency trading) describes trading in the many currencies of the world. It is the largest market, which provides a large amount of liquidity to traders. Each day the markets trade over  $1.5 trillion, if you compare the New York Stock Exchange which trades  $27 billion a day you can begin to see how massive this market really is.

The spot Forex market trades are settled within two banking days. There is no central exchange like futures, and most of the trades are done electronically. The big boy’s in this game are the Banks, Hedge Funds and financial organisations. 

However, with new rules and introduction of Trading Platforms across the internet almost anyone can now start trading Currencies.

What Is Currency Trading?

Currency trading is the largest market on the planet. It is estimated that in excess of US$2 trillion is traded every day. Compare this to the New York Stock Exchange's daily transactions of approximately US$50 billion, and you can see that the magnitude of the currency trading market exceeds all other equity markets in the world combined. The practice of currency trading is also commonly referred to as foreign exchange, Forex, or FX, for short.

All currency has a value relative to other currencies on the planet. Currency trading uses the purchase and sale of large quantities of currency to leverage the shifts in relative value into profit.

Using Forex Automated Trading Systems

Just how important is an automated system to the Forex trading system?

Before we answer that question, let us first determine how large Forex trading market is. From there, we will know the importance of automated systems for the Forex market.

It is true that the Forex market is the largest market around the world not just in terms of average daily turnover and average revenue per trader. It is also the largest market in terms of participants.

You name it, we’ve got it. Take a look at the following:

Use These 3 Simple Guidelines to Boost Forex Profits

FOREX trading is nothing more than direct access trading of different types of foreign currencies.  In the past, foreign exchange trading was mostly limited to large banks and institutional traders.  Recent technological advancements have made it so that small traders can also take advantage of the many benefits of FOREX trading by using the various online trading platforms.