Forex is the short form of the Foreign Exchange. The Foreign exchange market is also known as “FX”, “Spot FX”, “Forex” and “Spot” market.

Foreign Exchange trade involves the trading of various currencies. This is to say that this market deals with the exchange of money. The currency trading is done in pairs. A currency is sold and the other is bought simultaneously by the traders. For instance a trader might sell Japanese yen and buy a Euro (YEN/EURO).

A nation’s economy impacts the rise or fall of the value of a currency. However, there are other factors as well that impact the currency rates but this is the main reason. It is very important for a trader to make a forecast about the rise or fall of the currency value. This is quite similar to the way the stock market works. Like, if you buy US Dollars it would be keeping in view the U.S. economy and what changes are going to occur in the economy in the near future.

Foreign Exchange market is said to be one of the biggest financial market in the world with a turnover of around $ 3.2 trillion a day. The turnover is almost three times the sum total of what the stock and futures market jointly makes.

The Foreign Exchange market was the avenue of only the big banks and financial institutions around two decades back. Only the banks, big institutes and the multinationals could take part in the forex trade at that time. But with the advancement of technology Foreign Exchange market became available online and since then it has been available even for individual traders and investors. These individuals can trade with even little amount of money.

There is no particular headquarter of the Forex Market. One can start with the Forex trading from anywhere all that is required to start with this trade is a computer and an internet connection and of course a little amount to invest into the market.

This is also referred to as an Over-The –Counter (OTC) market as it has no physical exchange or location. One can access the Foreign exchange market online, twenty four hors a day.

The currency symbols in Foreign exchange market exist of three letters. The name of the country is identified with the first two letters and the name of the country’s currency is identified by the third letter. (The EURO currency is an exception to this rule as it is used in more than one country).

As mentioned above Foreign Exchange market is available twenty four hours a day. This offers its traders the ease to trade at any time they like.

This market also offers high liquidity and because of this feature it is known to be the most competent and resourceful financial market worldwide.