1.2 - What the Forex

So what exactly is Forex? You’ve got it! Foreign Exchange currency trading.

Now most of us, who’ve been on holiday to somewhere using the same currency more than once, might have noticed that the amount you get for your money is never quite the same. That’s because currency values aren’t fixed and actually fluctuate – every second of the day! How much these rates move up or down, depends on a huge number of factors, some of which are big news stories or political events.

But if you’re savvy, you might watch the exchange rates ahead of a trip and try to make the trade  when you’re getting the highest value for your money. And when it comes to the end of your holiday and selling back the foreign currency, you might even get more (per dollar or euro etc.) than you’d started with. A profit! But not always…

When traded on a much larger and organised scale, for the purpose of making a profit, this is what we call the Forex market. A highly volatile but potentially lucrative global trading environment. The largest in the world with an estimated $4 trillion USD (that’s $4 million, million Dollars!) being traded every single day.

Forex is also a highly accessible and competitive market, with low transaction costs and a huge range of products to trade 24 hours a day. And thanks to modern mobile technology, buying and selling forex trades can be as easy as just a few taps on your screen. Newcomers to the arena like Cryptocurrencies have also now started sharing platforms with forex, like in Pipster- but we’ll go into more detail about these new players in the very next chapter.

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