Anatomy of the Forex Market (Graphic)

Source   http://www.pepperstone.com/

By Instruments
Foreign exchange swaps – $1,8 trillion – 45%
Spot – $1,5 trillion – 37,5%
Outright forwards – $475 billions – 11,9%
Currency options – $207 billions – 5,2%
Currency swap – $43 billions – 1%

By Counterparties
with other financial institutions (hedge funds, pension funds, central banks) – $1,9 trillion – 47,7%
with bank dealers – $1,5 trillion – 37,5%
with non-financial customers (corporations and governance) – $533 billions – 13,4%
private traders – $60 billions – 1,5%

Who Is Participating In Forex Market Trades?

Who Is Participating In Forex Market Trades?


Jun 30, 2010

The forex market is all about trading between countries, the currencies of these nations and the timing of investing in sure currencies. The FX market is trading between counties, usually completed with a dealer or a monetary company. Many people are concerned in forex trading, which is similar to stock market trading, but FX buying and selling is accomplished on a much larger total scale. Much of the buying and selling does take place between banks, governments, brokers and a small quantity of trades will take place in retail settings where the typical particular person concerned in trading is called a spectator. Monetary market and monetary conditions are making the forex market buying and selling go up and down daily. Hundreds of thousands are traded on a daily basis between most of the largest countries and this is going to incorporate some amount of trading in smaller international locations as well.

From the studies through the years, most trades in the foreign exchange market are accomplished between banks and this is referred to as interbank. Banks make up about 50 percent of the buying and selling in the forex market. So, if banks are broadly utilizing this method to generate income for stockholders and for their own bettering of enterprise, you already know the money have to be there for the smaller investor, the fund managers to use to increase the quantity of interest paid to accounts. Banks commerce money each day to extend the amount of money they hold. Overnight a bank will invest millions in forex markets, after which the next day make that money available to the general public in their savings, checking accounts and etc.

Business firms are also trading more typically in the foreign exchange markets. The commercial companies resembling Deutsche bank, UBS, Citigroup, and others reminiscent of HSBC, Braclays, Merrill Lynch, JP Morgan Chase, and nonetheless others corresponding to Goldman Sachs, ABN Amro, Morgan Stanley, and so forth are actively buying and selling within the foreign exchange markets to extend wealth of stock holders. Many smaller companies will not be concerned within the foreign exchange markets as extensively as some massive corporations are however the choices are stil there.

Central banks are the banks that maintain worldwide roles in the international markets. The supply of money, the availability of cash, and the interest rates are managed by central banks. Central banks play a big position within the forex trading, and are situated in Tokyo, New York and in London. These usually are not the one central locations for foreign currency trading but these are among the many very largest concerned on this market strategy. Typically banks, industrial investors and the central banks may have massive losses, and this in flip is handed on to investors. Other instances, the buyers and banks will have big gains.

http://www.themarketfinancial.com/who-is-participating-in-forex-market-trades/5560

Why The Foreign Exchange Market Is Different From The Stock Market Report

by Todd Schuyler

Do you want to know the difference between the Foreign Exchange Market and the Stock Market? Find out here on my Forex trading software reviews blog article report.

The foreign exchange market is also known as the forex market. Trading that takes place between two counties with different currencies is the basis for the forex market and the background of the trading in this market.

The main difference between the stock market and the forex market is the vast trading that occurs on the forex market. There is millions and millions that are traded daily on the forex market, almost two trillion dollars is traded daily. The amount is much higher than the money traded on the daily stock market of any country. The forex numbers are astronomical!

What is traded, bought and sold on the forex market is something that can easily be liquidated, meaning it can be turned back to cash fast, or often times it is actually going to be cash. From one currency to another, the availability of cash in the forex market is something that can happen fast for any investor from any country.

The big difference between the stock market and the forex market is this. The forex market is worldwide. The stock market is something that takes place only within a country. The stock market is based on businesses and products that are within a country, and the forex market takes that a step further to include any country.

The stock market has set business hours. Generally, this is going to follow the business day, and will be closed on banking holidays and weekends. The forex market is one that is open generally twenty four hours a day because the vast number of countries that are involved in forex trading, buying and selling are located in so many different times zones.

The stock market in any country is going to be based on only that countries currency, say for example the Japanese yen, and the Japanese stock market, or the United States stock market and the dollar. However, in the forex market, you are involved with many types of countries, and many currencies. You will find references to a variety of currencies, and this is a big difference between the stock market and the forex market. You must get educated on forex because of the many types of currencies involved.

http://www.freefinancialtoday.com/2009/06/11/why-the-foreign-exchange-market-is-different-from-the-stock-market-report/