The term Forex refers to the market of Foreign Exchange. It is also called the FX market. It is the biggest global financial market with a net worth of over $2 trillion and counting. To put it in perspective, it is bigger than the total of the country’s Equity and Treasury markets.
The Forex, unlike several financial markets, like the stock exchange, that have a centralized operation in terms of the location, has no single, central location. Instead, it is a worldwide network of financial institutions, banks and traders, who are involved in the trade of purchasing and selling currencies of several nations. Moreover, another interesting feature about the Forex is that it operates throughout the day, with timings that correspond to the financial centre’s opening and closing throughout the day. In other words, it starts every day in Sydney, followed by Tokyo, after which it is London and finally, New York. Hence, you are likely to find buyers and/ or sellers, regardless of the location or the time. This nature of the Forex makes it an extremely liquid market and the best one at it.
Conventionally, only major financial institutions and banks has accessibility to the Forex market. However, as a result of technological changes and advancements, the Forex market today, can be accessed by everybody from a banking institutions to people who manage money to even traders who deal with retail accounts. If there has ever been a better time to get started and involved in the exciting Forex market, it is now. Therefore, to get started to trade, all you will need to do is create and account and become an active member in the world’s largest financial market. In fact, trading in the Forex is much simpler than in either commodities or stock.
You may not be aware, but you may already be part of the Forex market. Just by having money in your wallet makes you the investor in that currency. This especially the case if you own US Dollars. In other words, by owing US Dollars, you chose to not own other national currencies. Moreover, the composition of your bonds, shares, stocks and investments represent your personal investments that are heavily reliant on the value the currency that is denominated – the US Dollar.
Finally, it is worth remembering that the trading in currencies has an element of risk that is inherent to its nature. Hence, it is advisable that individuals who have the financial and emotional strength to bear a fair share of looses venture into this.