 Free Online Articles Directory |
|||||||
Home Page  Finance A Little History of the Forex Market |
|||||||
 |
A Little History of the Forex Market The purpose of these articles is to introduce the forex market to you. As with many markets there are many derivative of the central market such as futures, options and forwards. The word FOREX is derived from the words Foreign Exchange and is the largest financial market in the world. Unlike many markets the FX market is open 24 hours per day and has an estimated $1.2 Trillion in turnover every day. This tremendous turnover is more than the combined turnover of the main worlds' stock markets on any given day. This tends to lead to a very liquid market and thus a desirable market to trade. The Foreign Exchange market, also referred to as the "Forex" or "FX" market is the largest financial market in the world, with a daily average turnover 30 times larger than the combined volume of all U.S. equity markets. "Foreign Exchange" is the simultaneous buying of one currency and selling of another. Currencies are traded in pairs, for example Euro/US Dollar (EUR/USD) or US Dollar/Japanese Yen (USD/JPY). There are two reasons to buy and sell currencies. About 5% of daily turnover is from companies and governments that buy or sell products and services in a foreign country or must convert profits made in foreign currencies into their domestic currency. The other 95% is trading for profit, or speculation. For speculators, the best trading opportunities are with the most commonly traded (and therefore most liquid) currencies, called "the Majors." Today, more than 85% of all daily transactions involve trading of the Majors, which include the US Dollar, Japanese Yen, Euro, British Pound, Swiss Franc, Canadian Dollar and Australian Dollar. 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 within the reach of most investors. A true 24-hour market, Forex trading begins each day in Sydney, and moves around the globe as the business day begins in each financial center, first to Tokyo, London, and New York. Unlike any other financial market, investors can respond to currency fluctuations caused by economic, social and political events at the time they occur-day or night. The FX market is considered an Over The Counter (OTC) or 'interbank' market, due to the fact that transactions are conducted between two counterparts over the telephone or via an electronic network. Trading is not centralized on an exchange, as with the stock and futures markets.
Rate this Article:
Current: 0 / 5 stars - 0 vote(s).
Article Source: http://www.articlesbase.com/finance-articles/a-little-history-of-the-forex-market-80307.html
Related ArticlesUnderstanding Forex Quotes Beginners Trading Guidelines What I Learnt Losing $60,000 My First Year as a Full-Time Trader Foreign Exchange Day Trader Using Technical Indicators: Bollinger Bands & MACD How to Choose a Forex Broker? What Are the Differences Between Trading and Gambling? Forex Basic: MACD Got a Question? Ask.Ask the community a question about this article:Frequently Asked Questions How does Parliamentary Democracies government ... What ideas did Americans use from Great Britain? AOL/ATT Incoming Mail Problem Funndraiser For Family Of Mark Kisner Excgange rate Increase in debt Q&A Powered by:
 Latest Finance ArticlesStock Market Advice - Be Careful Who You Listen To Learning Proper Money Management For College Students Off Shore Incorporation In Ras Al Khaimah Is The Quickest In The Middle East BVI Offshore Registration: All That You Need To Know To Get Started The History of the Global Forex Market How To Go About Improving Your Credit Score Self Directed IRA Possibilities With A Small Business Understanding Debt Consolidation Loans More from Martin ChandraHow To Impress Any Woman How Do GMAT Scoring Algorithms Affect You? Establishing Your Online Domain Confidence Is Money The Way of the Spare Room Entrepreneur Rick Redmont Bases Trading on Wyckoff Theories Tom DeMark Relies 100% on Market Timing Tom Bierovic Uses Discretion on Top of His Rules |
|
|||||
|
Article Categories
|
|||||||
 Sign up for our email newsletterReceive updates, enter your email below
Use of this web site constitutes acceptance of the Terms Of Use and Privacy Policy | User published content is licensed under a Creative Commons License.
Copyright © 2005-2008 Free Articles by ArticlesBase.com, All rights reserved. (0.48, 16) |
|||||||
