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6th December 2019
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An Overview Of Forex Exchange

Forex Means Foreign Exchange & Forex Trading Means sale and purchase of foreign Currency in Foreign exchange market.

Foreign exchange market is the market where we can purchase and sale the foreign currency. This is Online market where all the dealings done through internet without physical existence. Foreign Exchange market is the world’s largest financial market. It’s a Trillion market .

As a beginner to deal in Forex Market we need to know about this market. And to know the market in simple way we need to answer some of the very simple questions which first strike in our mind.

Now question arises :

Why we need to exchange the money?

How Foreign Exchange come into existence?

How it becomes a largest market?

How it works?

Where we can trade the Forex?

So here the answers are :

Why we need to exchange the money?

The reason of Foreign Exchange come into existence is the need of a person to deal with a person of other country.

A businessman of USA deals in textile need to purchase thread form France. Now that businessman can not do the payment of thread in USD. He has to exchange his currency to French currency to pay the supplier in his country.

A tourist from Japan went to Switzerland to spent his vacations. He can not pay out there with japnses Yen, he has to first change the currency to spent in Switzerland.

How Foreign Exchange come into existence?

The main reason to exchange the currencies is so called business deals, tourisoum .

And when the people come to know the profitability and lots of difference in the rates of all currencies than they start trading of it.

And when people start sale and purchase than there is start of new market called Foreign Exchange Market.

How it becomes a largest market?

The main reason to become  Forgein Exchange trading so large is that it deals with major industries such as Banks, Central Banks, Big Corporation, Investment Managers.

How it works?

Firstly we have to understand that Forex is buying and selling of currencies. A currency can buy against the selling of another currency.

As one currency’s value is equal to X number of other currency, so it always traded in pair. The common pairs are CAD/EUR, CAD/GBP, CAD/USD.

Where we can trade the Forex:

Like other Industries Forgien Exchange market does not have physical existence. All the trading is done online through Internet. In this era where internet has shrink the whole world there nothing is impossible to deal with. Anyone can sale and purchase the currency online.


Now we got the answers for basic questions of Forgein Exchange Market , So it is easy for us to deal in with a proper mind set.



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