The foreign exchange market is comprised of all the world’s currencies which are bought and sold across local and global markets. The qualified values of different currencies are unwavering by the foreign exchange market, and in turn, the foreign exchange market rises and falls in response to real-time events. Investors trade when they’re assured that the currency they are buying will appreciate in relation to the currency they are selling.
An exchange rate is the rate at which currencies are traded in pairs and exchanged against one another. Most of the currencies are traded against the US dollar (USD) but are also traded against the euro (EUR), the Japanese Yen (JPY), sterling (GBP) and Swiss francs (CHF).
The foreign exchange market’s relentless action and vast trading volume leads to high liquidity and geographic dispersion. Many people say that due to these conditions, the foreign exchange market is the closest to the ideal of perfect competition.
The Bank for International Settlements reported that the average daily turnover in the global foreign exchange markets is estimated to be around $3.21 trillion; a growth of approximately 20% since April 2007, and is expected to continue growing.
The $3.21 trillion break-down is as follows:
Traders in the foreign exchange market include large banks, central banks, currency speculators, corporations, governments, and other financial institutions.
If you wish to learn more about the deVere Foreign Exchange service, please feel free to contact us.
Contact deVere Group Foreign Exchange to start trading today.