Forex trading or Foreign Exchange Trading refers to the simultaneous tradingthat is, buying and sellingof two different currencies. It is done between and among major financial institutions, central banks, small retail currency traders or speculators, large international companies, government institutions, companies with overseas operations and the like.
Based on the amount of money being traded, the international forex trading market is the worlds biggest financial market. Everyday, forex trading market gets an average revenue of $US 1 trillionan amount far greater than the total revenues produced by all the stock and bond markets in the world.
Characteristics
Forex trading is a kind of over-the-counter tradingit occurs directly between to financial institutions or currency traders. The trading markets may be interconnected but there is no single unified market. Hence, there is also no single or standard rate. Each rate or price depends on what is being traded. However, the traders traditionally use nearly similar rates.
Another characteristic of a forex trading is that it operates 24 hours; thus, one can trade any time of the day. Also, there is...
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