WHAT IS FOREX TRADING?

There are a lot of ways to make money in this global economy with which we live and one of those ways is in a market known as Forex. Forex, also referred to as FX or the currency market, is short for foreign exchange. This market is larger than any other financial market in the world as it does $5 trillion worth of business daily.

Unlike institutions such as the stock exchange, there is no centralized marketplace for forex as currencies are traded in all of the major financial centers of the world; Sydney, Paris, Hong Kong, Singapore, Zurich, Frankfurt, Tokyo, London, and New York.

A basic explanation of this system is that currency is bought at one price and sold at a higher price in order to make a profit. Investors can also sell at one price and buy at a lower. The ultimate goal is profit.

This is the basis for international business. If a company in the United States wants to do business with a company in Japan, they have to exchange their US dollars for Japanese yen before the deal can be done.

Currencies can be bought and sold by anyone from large corporations to individuals wanting to diversify their portfolios. It is a difficult market to do business in because these numbers are changing by the minute.

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