A simple definition of foreign exchange is the exchange of the currency of one country with that of another country in order to complete a transaction. With the advent of international trade and the absence of an international monetary unit, one of a nation's prime concerns is the rate at which it's own local currency can be exchanged for units of a foreign currency. This system of global trading in foreign currency is known as the Foreign Exchange Market, or Forex. In comparison to the average daily trading volume of $300 Billion in the U.S.Treasury Bond market and the less than $10 Billion exchanged in the U.S. Stock Markets, the Forex market trades to the tune of more than $1.6 Trillion a day. It is by far the largest and most liquid market in the world.
No comments:
Post a Comment