Currency Exchange Market – What is a Currency Exchange?
A currency in the simplest definition is currency in circulation as a legal tender or circulating unit of currency when in use or circulating as a medium of trade. The units or coins in circulation can be measured by weight, standardized by countries, or collected by governments. In its most popular form the U.S. dollar is the unit of currency most often used throughout the world. Other names for the U.S. Dollar are US, pee, teaspoon, and the like. It has also become known as the “world’s coin,” because the US dollar is widely accepted throughout the world as a legal tender for all but emergency transactions.
Forex exchanges are venues through which traders in different countries can buy and sell currencies to gain a profit. It is usually an online venue, but some brokers still do the actual trade. The buying and selling of currencies takes place in what is called a Forex market. These markets are open from Monday to Friday, with the exception of holidays. All orders for buying and selling are placed during business hours, usually through automated Forex systems. When the markets close, the trading is closed.
There are many currencies that are traded on the Forex exchange market, including the American Dollar, the British Pound, the Euro, the Japanese Yen, and the Swiss Franc. Major countries whose currencies are traded on the Forex exchange market include China, Japan, Russia, India, and many other countries. As trading on this global exchange market continues to grow, so have the numbers of people that participate in it. Some estimates say that over 2 trillion dollars changes hands daily on the global currency exchange market.