The Great Players in the Forex Market

March 23, 2012 by Dmitry Vasenyov  
Filed under Finance

Nowadays, the Forex market is the biggest financial market in the world. You need to know that the average daily turnover on the Forex market is about three trillion dollars. Such a big trading volume is created by various traders and institutions, each of them with various intention.

You have to know that central banks are one of the biggest players in the Forex market. The main purpose of central banks is to keep the economy and the currency of their country stable.

As a rule, this is done with the interest rate decision and trading the Forex market. Today the majority of central banks are active Forex traders, mainly to stabilize their currency as well as have a great Forex reserve.

The other great Forex traders are commercial banks. As a rule, commercial banks trade on the behalf of other traders. And this requires them to exchange different currencies with one another in accordance with their clients’ needs. The commercial banks trade various world currencies for speculation as well as to make some money from this. Once commercial banks think that one world currency will rise over another one, they perform the appropriate trade in order to be sure that they profit from it. Because commercial banks control the majority of money in the globe, they are among the greatest Forex traders.

Both exporters and importers are a vital part of the Forex market. Because these companies traditionally work with countries other than their own, they work in different currencies as well. Their major activity in the Forex market is to exchange money from their currency to the currency of their client and vice versa. As well, they use the Forex market in order to ensure a certain profit. As a rule, this is done just to avoid the impact of fluctuations in exchange rates and to ensure future profits.

Should you consider start forex investment, it is wise to find out some details on this market. If you are properly armed with the knowledge in your sphere you can avoid many risks related to this business. So studying forex trading and only then plunging in Forex trading would be an intelligent step.

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