WHAT IS FOREX

The Foreign Exchange Market also referred to as the "Forex" or "FX" market is the largest financial market in the world, with a daily average turnover of approximately US $3 trillion. The most often traded or 'liquid' currencies are those of countries with stable governments, respected central banks, and low inflation. Today, over 85% of all daily transaction involve trading of the major currencies; with include the US Dollar, Japanese Yen, Euro, British Pound, Swiss Franc, Canadian, Australian and New Zealand Dollar.

Forex Trading is not centralized on an exchange, as with the stock and futures markets. It doesn't have a fixed location of a trading floor. The Forex Market is considered an Over the Counter (OTC) or "Interbank" market. The trading is done over the telephone and at computer terminals, in hundreds of banks around the world simultaneously.

Historically, Forex trading has been dominated by banks, including central banks, commercial banks and investment banks. However, the percentage of other market participants is rapidly growing, and now includes large multinational corporations, global money managers, registered dealers, international money brokers, option traders and private traders.

A true 24-hour market, Forex trading begins each day in Auckland, and moves around the globe as the business day begins in each financial centre, first to Tokyo, then London and New York. Unlike any other financial market, investors can respond to currency fluctuations, caused by economic, social and political events at the time they occur - day or night.