How Forex Trading Work?

in hive-152587 •  3 years ago 

Forex trading work: -

Unlike shares or goods, forex trading doesn't take place on exchanges but directly between two parties, in an over-the-counter (OTC) request. The forex request is run by a global network of banks, spread across four major forex trading centers in different time zones London, New York, Sydney, and Tokyo. Because there's no central position, you can trade forex 24 hours a day.

There are three different types of forex market: -

1:-Future forex market: - a contract is agreed to buy or sell a set amount of a given currency at a set price and date in the future. Unlike forwards, a futures contract is legally binding
2:- Forward forex market: - a contract is agreed to buy or sell a set amount of a currency at a specified price, to be settled at a set date in the future or within a range of future dates
3:-Spot forex market: - the physical exchange of a currency pair, which takes place at the exact point the trade is settled – ie ‘on the spot’ – or within a short period

Most traders speculating on forex prices will not plan to take delivery of the currency itself; instead, they make exchange rate predictions to take advantage of price movements in the market.

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A contract is agreed to buy or sell a set amount of a currency at a specified price.