Monday, May 5, 2008

What is Forex Trading?

The word FOREX is derived from Foreign Exchange and is the largest financial market
in the world. Unlike many markets, the FX market is open 24 hours per day, 5 days per week and has an estimated $1.5 Trillion in turnover every day. This tremendous turnover is more than the combination of all the worlds' stock markets on any given day. This tends to lead to a very liquid market and thus a desirable market to trade.
Unlike many other securities (any financial instrument that can be traded) the FX market
does not have a fixed exchange. It is primarily traded through banks, brokers, dealers,
financial institutions and private individuals. Trades are executed through phone and
increasingly through the Internet. It is only in the last few years that the smaller investor
has been able to gain access to this market. Previously, the large amounts of deposits
required precluded the smaller investors. With the advent of the Internet and growing
competition it is now easily in the reach of most investors.

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