4 REX Around The World

Forex market- is an international foreign exchange market. It gets its name from English shortening FOReign Exchange- foreign exchange operations. Forex market is one of the youngest financial markets (Forex has existed since the 70th of the last century). However, it is the largest in volume and fastest-growing market. The daily trading turnover at Forex constitutes to 4 trillions dollars, which in 30 times exceeds the combined volume of all stock markets in the USA.

Like any other market, Forex trades certain goods. In case of foreign exchange market these goods are national currencies of different countries.

The key factor of currency rate movement is the need of state bodies as well as commercial companies to convert profits from the sale of goods and services abroad into its national currency. It accounts for 5% of the foreign exchange market turnover. The remaining 95% provides currency traders speculative capital aiming at extracting profit from currencies rate movement.

Distinctive feature of the foreign exchange market is its stability. It is a well-known fact that the main threat for any financial market is its meltdown, the fall of the stock index. However, unlike other markets (stock and commodity markets) Forex is defended owing to the specific of its commodity - currency. If shares devalue it is a financial collapse. If the dollar falls, this means that another currency has become stronger, market movement becomes more active. This is a good chance to generate additional profit for a trader. Unique stability of the Forex market lies in this Forex peculiarity: currency is one of the most liquid and reliable trading instrument among all existing.