Foreign Exchange

Foreign exchange market is the largest financial market in the world, where buyers and sellers do foreign exchange business. In foreign exchange market, a nation's currency is exchanged for that of another typically via brokers. Forex market operates on a 24-hour basis because it has no physical location and no central exchange. It works through a global network of banks, corporations and individuals trading one currency for another. It is a non-stop cash market where foreign currencies are bought and sold continuously and concurrently across local and global markets. Up or down in foreign exchange market depends on the current affairs and present events of the world.
The purpose of the foreign exchange market is to help international trade and investment. In a typical foreign exchange transaction, a party purchases a quantity of one currency by paying a quantity of another currency. The main traders of Forex market are large banks, central banks, currency speculators, corporations, governments, and other financial institutions. The average daily volume in the global foreign exchange and related markets is continuously growing because of low margins of profit as compared to other markets of fixed income but the rate of profits is high due to very large trading volumes.
Trading in the Forex market is done for almost all the foreign currencies but some currency pairs are most important due to their trading demand in the market. These dominant currency pairs are as follows:
Euro/ U.S. Dollar
US Dollar/ Japanese Yen
US Dollar/ Swiss Franc
US Dollar/ British Pound
Trading foreign exchange on margin carries a high level of threat of loss, and may not be suitable for inexperienced and new investors. Being new and inexpert you could sustain a loss of some or all of your initial investment therefore you should not invest all your money in this business.