What is Forex trading?
Forex , which is also known as FX or currency trading, alludes to a decentralized global market where all the world’s currencies are traded. Forex trading can also be referred to as a global over-the-counter (OTC) market where institutions, traders, banks, and investors speculate, exchange, buy as well sell world currencies. Usually, forex trading involves buyers and sellers who transfer currencies between them at an agreed price .
Additionally, the forex market is actually one of the largest markets in the world, and that is in terms of liquidity since it usually has an average daily trading volume that exceeds 45 trillion, which is not even close to the world’s combined stock markets. Usually, forex trading is commonly practiced with the aim of making profits given the fact that the amount of currency converted on a daily basis influences some currencies to become less or more volatile.
It’s also important to note that volatility makes currency trading much attractive to trades since the lesser the volatility, the less risky the currency. Unlike other assets, currency trading can be conducted in whatever market is open at a given time since it has no centralized marketplace. The currency markets operate 24 hours a day five and a half days a week.