What is Forex (Foreign Exchange)?
Forex (foreign exchange) is a global market for the trading of currencies. It is open 24 hours a day, five days a week, and can be traded in all major financial centers worldwide: London, New York, Paris, Zurich, Frankfurt, Singapore, Tokyo, and Hong Kong–with prices changing constantly throughout the day taylorsource.
Forex is a popular place for companies and traders to speculate on the rise or fall of currency prices, as well as to hedge against foreign exchange risk. It is also used for transactions that involve currency, such as travel abroad and the import of goods from other countries holidaysnbeyond.
The spot market, the most common form of forex trading, involves the purchase and sale of actual currencies. It is based on a currency’s current value, based on economic and geopolitical factors such as interest rates and political events hanjuthai.
In addition to the spot market, there are two other venues for forex trading: forwards markets and futures markets. The forwards market is more common with companies and financial firms that need to lock in an exchange rate for a specific amount of currency on a certain date in the future testrific.
The futures market is similar to the forwards market, but standardized contracts are traded on an exchange rather than privately. In futures markets, trader’s positions are settled at a specified price per unit of currency on a certain date in the near future hukol.