Forex Basics

What is Forex?

Forex, which is also referred to as FX, Spot FX, Foreign Exchange, Currency Trading or Retail Forex, is the largest financial market in the world. The forex market trades around $4 trillion a day. Three times more volume is traded on the forex market than the stock and futures markets combined.

In forex, you are essentially trading foreign currencies, which is done by simultaneously buying one currency and selling another. Currencies are traded in pairs and are cleared through a forex broker in the retail off-exchange market and through banks in the inter-bank institutional foreign exchange market.

You are not actually taking possession of foreign currencies per say, which is why the forex market is so liquid, but you are instead buying the future health of that particular country.

If you want a complete education in forex trading, please visit  http://www.babypips.com/school/.

If you would like to learn about forex terminology, please visit
http://www.investopedia.com/categories/forex.asp.