The Foreign Exchange Market (Forex)
has no central exchange location yet it is the largest financial market in the
world. It is over 3x's the size of the stock and futures markets combined and
operates via an electronic network of a banks, corporations and investors.
Foreign exchange consists of a simultaneous buying of one currency and
selling of another. Currency is traded in pairs, in other words, one currency is
traded for another. The major currencies are:
USD - United States Dollar
EUR - Euro members Euro
JPY - Japan Yen
GBP - Great Britian pound
CHF - Switzerland franc
CAD - Canadian dollar
AUD - Australia dollar
There are 2 types of investors involved in the
Forex market.The first type of
investor is the hedger. The hedger is involved in International trades and
utilizes Forex trading to protect
their interest in a transaction from adverse currency fluctuations. The 2nd type
of investor is the speculator who invests in currency solely for profit.
