(OP)inions What is forex trading?

February 23, 2022 

Forex or FX trading is the market in which people are able to buy and sell international currency pairs.  

It is the most liquid market in the world with huge volumes. Every day approximately $4 trillion is exchanged.  

Compared to trading other asset classes like shares and CFDs, forex is very different.  

Forex trading provides an opportunity for investors with relatively small amounts of capital available to still be able to invest. Traders invest in exchange rate pairs to trade one currency against another. You sell one currency to buy another. For example, you might want to invest in USD/GBP, thinking that the USD will become stronger against the GBP.  

There are three main ways to conduct forex transactions: 

Spot market.This is based on current exchange rates and the transaction happens “on the spot.”  

Forward market.Invest a contract for a specific currency e.g. EUR at a certain exchange rate on a specific date when the exchange will take place.  

Futures market.Trading on the futures market is very similar to the forward market, a futures market is a legally binding agreement settled on an official commodities market. 

OnePro Special Analyst

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The foregoing is a personal opinion only and does not represent any opinion of OnePro Global, nor is there any guarantee of reliability, accuracy or originality in the foregoing.

Forex and CFD trading may pose a risk to your invested capital.

Before making an investment decision, investors should consider their own circumstances to assess the risks of investment products. If necessary, consult a professional investment advisor.  

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