Forex Trading begins in Sydney, Australia each day and moves around the world as the business day opens. This market is unique because investors can respond to currency fluctuations caused by political, economic and social events immediately.
Because transactions are conducted between 2 counterparts over the telephone or via an electronic network, the Forex market is considered an Over the Counter (OTC) or ‘interbank’ market. With stocks and futures trading is centralized, not true in this market.
There are no commissions or fees with Forex.com, but there is free access to real-time quotes, news, charts, research and more. Dealing spreads as low as 3 pips (.003) are available in currency trading.
The Forex trader can respond to market changes immediately. It is a 24 hour market open continuously from 5pm ET on Sunday to 4:30pm on Friday. There are 3 distinct trading sessions in the US, Europe and Asia.
There is less cash outlay in Forex because you can leverage your buying power through margin accounts. Trading on the margin does work both ways. It magnifies your profits and losses.
Forex is the largest most liquid market in the world. 90% of all currency transactions involve 7 major currency pairs. Because of this, these currencies show smooth trends and have the tightest dealing spreads and highest level of liquidity.
