Information about FOREX for beginners

Almost everyone wants to quickly learn the ways of trading in FOREX market, which is most commonly known as the foreign exchange market. However, the beginners should understand the basics to ensure that how the dynamics of this market works. The currency trading is considered as the largest industry or market worldwide as it comprises of more than trillion trading transactions in terms of daily volume. Investors want to learn more about this market so that they can trade efficiently within the industry. It is even the most liquid market; however, there is no centralized place for the trading of currencies in the market.

Almost all of the trading in this market is performed over-the-counter with which the transactions take place at a faster pace within the industry. It is a belief that if the dealer is huge, then it will have more access to the pricing found at the world’s largest banks. One of the most commonly found sub markets in the FOREX market is the spot currency market. The key features of this sub-division are that it operates twenty-four hours every day and five days every week. All of the transactions which take place in the FOREX market comprise of buying one of the currencies and selling other at the same time. The main reason for this is that the currency’s value is dependent upon the comparative basis of the other currency.

In the currency pair, the first currency is known as ‘base currency’ and the other currency is called ‘counter currency’. The currency pairs are considered to be used as dominations for currency as they are believed to be denoted as one unit for buying or selling. When a currency pair is purchased, counter currency is sold and base currency is bought. The four major currency pairs observed globally are given as under:

  • USD/CHF,
  • EUR/USD,
  • and USD/JPY.