Foreign Exchange, also known as Forex or just FX, refers to a global market that allows the trading of currencies. Since it is a global marketplace, forex is believed to be the largest and most liquid market in the world.
The main participants in the Forex market are major international banks, which are represented by smaller parties who buy and sell numerous global currencies.
Forex is known for its substantial trading volume as this market allows investors to make trades twenty-four hours seven days a week. Back in 2019, reports showed that as much as £6.6 trillion was traded on a daily basis on Forex, marking the highest-grossing revenue when it comes to fiat currencies.
Another unique aspect of this market is that there is no central exchange where trading is performed. Instead, Forex market participants buy and sell currencies electronically over the counter (OTC). In other words, Forex trading is conducted using traders’ own computer networks around the world, rather than through a centralized marketplace.
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