The Foreign Exchange or Forex market is where the world currencies are traded. It is the largest in the world with individuals, companies, and banks carrying out around $6.6 trillion worth of currency transactions every signle day.
What is forex trading?
Forex trading, also known as foreign exchange or FX trading, is the conversion of one currency into another. While a lot of foreign exchange is done for practical purposes, the vast majority of currency conversion is undertaken by forex traders to earn a profit or to hedge portfolio investments.
More about Forex
Forex trading in the spot market has always been the largest part of the FX market because it is the "underlying" real asset that the forwards and futures markets are based on. In the past, the futures market was the most popular venue for traders because it was available to individual investors for a longer period of time.
Futures & Forwards
With the advent of electronic trading and numerous forex brokers, the spot market has witnessed a huge surge in activity and now surpasses the futures market as the preferred trading venue for individual investors and speculators.
The future is Forex!
"When people refer to the forex market, they usually are referring to the spot market"
The forwards and futures markets tend to be more popular with companies that need to hedge their foreign exchange risks out to a specific date in the future.
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