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Definition of Forex

Forex is an abbreviation of foreign exchange or foreign currency exchange. Foreign currency trading occurs because of the foreign currency needs of the community, for example:

– For vacation needs abroad.

– Buying goods from abroad
– Business activities

You can visit our website and make managed forex to start trading forex. You can buy or sell foreign currency with several types of markets, such as:

– Spot Market

The spot market is buying and selling foreign currency in bank and money changer. If you want to vacation or travel abroad, then you can exchange money in the bank or money changer.

– Forward Market

This market serves forward transactions (purchase contracts with preliminary agreements) of a foreign currency. This forward trade is done in a place, for example, large banks. For example, ABCDE has a debt to the US factory of US $ 30,000. The debt will mature in early July 2017. ABCDE’s finance department is afraid if the US Dollar prices suddenly rise fast. Finally, the finance department of ABCDE entered into a purchase contract of US $ at the forward market ABCDE will buy the US $ as much as the US $ 30,000 on June 30, 2017. Foreign exchange trading in the forward market is aimed at firms to secure exchange rates (hedging). Usually, the contract reaches hundreds of thousands to millions US $.

– Market Futures

Also referred to as futures trading and essentially similar to the forward market. The trading bout in the futures market is done over the counter (OTC). So the trade is done on an exchange. Trading futures is not only foreign exchange trading but also commodity trading (wheat, sugar, silk, rubber and so on) Examples of exchanges that regulate futures trading: Kansai Agricultural Commodities Exchange (KAE), Nagoya Grain and Sugar Exchange (NGE), Tokyo Grain Exchange (TGE), and others.- Option Market Someone who buys options is buying options or opportunities (rights, not obligations).

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