Definition of CFDs
Retail FX trading represents a small segment within the overall foreign exchange market. In this form of trading, individuals do not physically buy or sell currencies. You don’t need to own yens to buy pounds, or Swiss francs to buy Russian rubles. Instead, it involves speculating on the direction of exchange rates between two currencies, […]
The Evolution of the Forex Market
In this lesson, we will explore the evolution of the FX market in recent years. Prior to 1996, the forex market was predominantly accessible to large financial institutions, central banks, corporations, governments hedge funds and very wealthy individuals. Participation in the forex market was quite challenging because you needed substantial balances to generate significant profit. […]
Currency Pairs Categories
Today we’ll explore the categories of currency pairs. Currency pairs are divided into three primary categories, majors, minors and exotics. The major currency pairs feature the US dollar on one side, either as the base or the quote currency. This is because the US Dollar is considered as the world’s reserve currency, a status established […]
Trade FX – The Basics
Forex trading involves buying a currency and simultaneously selling another with the expectation that the currency you bought will increase in value. It’s essential to note that each currency pair comprises two currencies. The one listed on the left-hand side is the base currency, and the one on the right-hand side is the variable currency, […]
Money’s Dual Nature and Exchange Rates
We’re all familiar with money, but how do we define it? Over time, money has taken on various forms. Among the items historically used as money were stones as well as metals including gold and silver in various forms and sizes. Nowadays, some even characterize cryptocurrencies as a form of money, though this is still […]
Currencies and Currency Pairs
As there are hundreds of currencies available, it is not feasible to monitor each one. The key currencies are the US Dollar in the US, the Euro in the Eurozone, the Pound in the United Kingdom, and the Yen in Japan. Generally, each country maintains its own currency. However, there are instances where multiple countries […]
Key Players in the Forex Market
So, who are the key players responsible for creating such a substantial daily turnover volume in the FX market? Governments and central banks: National governments and central banks play a significant role in the FX market to either strengthen or weaken their currency by buying it or selling it respectively and adjusting their foreign exchange […]
Introduction to the Forex Market
Foreign exchange is referred to as forex, or FX in short. The FX market is a marketplace where you can engage in trading or exchange of currencies. It operates as a decentralised over-the-counter market (OTC), with no actual physical central exchange. Commodities, stocks, debt securities and derivatives are just a few of the securities that […]
