What is FOREX?

Forex (also known as FX) is simply shorthand for “foreign exchange”, which is the trading of one currency for another. A forex trader speculates on the price movements of one currency against another with the aim of making a profit.

Forex is the world’s most traded market with over $7.5 trillion* being traded every day. To put it in perspective, the daily average volume for the S&P 500 is only $553 billion (2.27% of the size of forex)**

When you travel to another country, you usually exchange your money into the foreign currency to spend money there. Sometimes, whatever you don’t end up spending you’ll convert back. This is forex.

You’re always trading one currency against another, such as the US dollar against the Canadian dollar (USD/CAD). This is called a forex pair.

Forex is an exceptionally liquid market, and it’s reacting all the time. This makes it especially attractive to day traders looking for short-term wins.

Unlike stocks which use exchanges such as the New York Stock Exchange, forex is traded by a decentralized global network of banks.

You can trade forex 24 hours a day, 5 days a week, from Sunday 5PM to Friday 5PM. This is because the time zones of the four trading centers (London, New York, Sydney, and Tokyo) overlap with each other. So, when one closes, another opens.