Foreign Exchange, or popularly known as Forex, is a market where buying and selling of currencies is being done. Forex is the world’s largest trading market and has huge number of trader and brokers involved in currency trading. Apart from being available 24 hours a day, 7 days a week, Forex can also be done online, so different traders around the globe could participate in here.

The Forex or foreign exchanges is much more different and advantageous compared to other forms of market such as the Stock Exchange Market. Forex is unique because the benefits and the amount of money traded daily are extremely large.

With more than 3 trillions of dollars on trade, Forex involves trading currencies all over the world such as British Pound, US Dollar, Japanese Yen and EURO. Currencies are divided into two, which are called the ‘Majors’ (US Dollar) and the ‘Minors’ (Australian Dollar). These ‘Majors’ and ‘Minors’ are always being paired in the Forex Market which is called currency pairs. The most common currency pairs are EURUSD (Euro/ US Dollar), GBP/USD (British pound/ US dollar), and USD/JPY (US dollar/Japanese Yen).

Forex, unlike other exchange markets, is an Interbank/Interdealer market where the transfer or trading is done via a broker or a bank. Forex is also referred as over the counter (OTC) market, because it has no central building or land based office and all the trading is done on phone or internet. That is why the Foreign Exchange market is considered to be the most liquid market in the world.

Since Forex involves currencies around the world, there are a lot of factors that could affect the prices of currency trading. Such factors are because of political, economical or social changes of particular country. Some causes of the currency prices fluctuation may be due to change in quotes or policies of banks since a lot of major banks around the world are the major players in the Forex Market.

Forex Market is a very unstable market due to everyday factors that could easily affect currency trading. That is why Forex is a very serious matter and a lot of traders or brokers offer Forex education through Forex Trading courses and Forex Books which can be available over the internet. If you would start trading in Forex, it is important for you to undergo these courses since Forex requires skills and knowledge for you to be a successful trader.

In trading, you will encounter terms used in Forex such as pips, spread and bid. Forex may sound serious and it has management tools that can make it easier for a new comer. Tools like demo account that allows a new trader to trade real but with unreal account and investment. This tool can offer great assistance in real Forex dealings in the future.

It is important to remember that the key to a successful trader is patience and discipline. Forex is a not for those who are over-confident and without prior knowledge. Skills and knowledge will definitely help you to be a successful trader