International Forex Inforamtion

FOREX actually means Foreign exchange and is used in lieu of currency or fx. FOREX means exchanging one currency for another currency or trading one currency type to another currency type. Generally speaking, FOREX is done through foreign exchange markets within different countries throughout the world. FOREX markets are the biggest markets one can find today. A typical foreign exchange market trades currency between large governmental and private sector banks, multinational companies, currency speculators, huge financial institutions. The large size of forex markets can be seen by the figure of $3trillion which is the currency trading on a daily basis.FOREX markets are special throughout the world due to their daily trading volumes, different and varied kinds of traders involved, extremely volatile markets throughout the world, longer trading hours of 24 a day, geographical distribution of the markets, numerous factors affecting the exchange rates, high amount of risk involved in trading due to huge volumes and volatility of markets. Novel financial instruments called derivatives also trade around $2 trillion daily in addition to the traditional ones.
A few top international banks that usually trade or participate in forex trading are Bank of America, Union bank of Switzerland, Citibank, Deutsche bank, Barclay’s capital, Hong Kong and Shanghai Banking Corporation, JP Morgan and some others. A forex market is different from a stock market in that not all the players have access to the prices. Access to the price of a level is confined to the players in that level only. On top of all comes inter-bank market which is traded by the largest investment banking firms of the world. The trading in inter-bank market is almost half of all the transactions done in the forex market. Apart from the top banks, some nationalized banks, financial institutions, investment management companies, commercial firms, hedge funds. The important trading centers through the world are New York, London, Tokyo and Singapore, but almost all the banks trade. As there is a difference in the time zones of countries in the world, as the American trading session ends, Asian trading session begins, and then European trading session begins and the circle goes on for the entire 24 hours of a day. Retail brokers participate in trading but they do only a minute percentage of 2-3 of the total trading, which is roughly $40 billion. New and small investors should be aware of all the proceedings and technical terms within the market or else they are highly vulnerable to forex scams.