Why is Forex Trading so Popular?
All over the internet is common to see many different ads posted by forex brokers, which talk about forex trading and that invite you to open an account and start operating with it. However is hard to see someone that explains what forex trading is, how it is structured and its characteristics.
I think that understanding the environment can be very useful to make informed decisions, especially in this environment, where with the growth of social media promotion, portraying lavish lifestyles involving champagne and expensive cars, uninformed persons may be deceived.
The foreign exchange market (Forex), is the marketplace where happen all transactions related to currencies. It is the largest and most liquid market in the world, but unlike the stock market, it has not a centralized location. It is an over-the-counter market (OTC), which means that it is a decentralized market composed of a network of banks, brokers, institutions, and individual traders. This implies that there is not a single exchange rate but several different rates (prices), depending on what bank or market maker is trading, and where it is. However, in practice, the rates are quite close due to arbitrage.
Moreover, given that this is the largest market in the world and most of the volume is created by banks and big financial institutions, it is open 24 hours a day, five…
