Who is participating in FOREX market trades?The FOREX market is all about trading between countries, the currencies of those countries and the timing of investing in certain currencies, usually completed with a broker or a financial company. Many people are involved in FOREX trading, which is similar to stock market trading, but FX trading is completed on a much larger overall scale. Much of the trading does take place between banks, governments, brokers and a small amount of trades will take place in retail settings where the average person involved in trading is known as a spectator. Financial markets and financial conditions are making the FOREX market trading go up and down daily. Millions are traded on a daily basis between many of the largest countries and this is going to include some amount of trading in smaller countries as well. From the studies over the years, many trades in the FOREX market are done directly between banks; this is called interbank trading. Banks make up about 50 percent of the trading in the FOREX market. So, if banks are widely using this method to make money for stockholders and for their own bettering of business, you know the money must be there for the smaller investor. The fund managers use FOREX to increase the amount of interest paid to accounts. Banks trade money daily to increase the amount of money they hold. Overnight, a bank will invest millions in FOREX markets, and then the next day make the profit on trading that money available to the public for loans and mortgages. Commercial companies are also trading more often in the FOREX markets. Large commercial companies such as General Motors, Chrysler Daimler, Toyota, Deutsche bank, UBS, Citigroup, HSBC, Barclays, Merrill Lynch, JP Morgan Chase, Goldman Sachs, ABN Amro, Morgan Stanley, and so on are actively trading in the FOREX markets to increase wealth of stock holders. Many smaller companies may not be involved in the FOREX markets as extensively as some large companies are but the options are still there. Large manufacturers of products that are distributed internationally (like car manufacturers) buy futures at a range of prices in order to protext themselves against massive moves in currency values. Central banks are the banks that hold international roles in the foreign markets. The supply of money, the availability of money, and the interest rates are controlled by central banks. Central banks play a large role in the FOREX trading, and are located in Tokyo, New York and in London. These are not the only central locations for FOREX trading but these are among the very largest involved in this type of market. Some of the most popular trades occur between the Euro and the US dollar, the US dollar and the Japanese yen, and the British pound and the US dollar. The trades happen all day, all night, and through out various markets. As one country opens trading for the day another is closing. The time zones across the world affect how the trading takes place and when the markets are open. |
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