What is Forex?
The foreign exchange market – also known as forex or the FX market – is the world’s most traded market, with a turnover of $5 trillion per day. To put this into perspective, the U.S. stock market trades around $257 billion a day; quite a large sum, but only a fraction of what forex trades.
Forex is traded 24 hours a day, 5 days a week by banks, institutions, and individual traders worldwide. Unlike other financial markets, there is no centralized marketplace for forex — currencies trade over the counter in whatever market is open at that time.
How Forex Trading Works
Trading forex involves the buying of one currency and the simultaneous selling of another. In forex, traders attempt to profit by buying and selling currencies based on speculating the direction they are likely to take in the future.
When Can I Trade Forex?
You can trade forex 24 hours a day, five days a week. The foreign exchange markets are global, following a 24-hour timeline.
The trading week begins Monday morning in Sydney, Australia, and follows the sun westward as the world’s major capital markets open and close —
from Tokyo to London, ending Friday evening in New York.