Forex trading is the simultaneous buying and selling of the world’s currencies on a decentralised global market. It’s also referred to as the foreign exchange or FX market. As one of the largest and most liquid financial markets in the world, its total average turnover per day is reported to exceed $5 trillion. The forex market is not based in a central location or exchange so is open to trade 24 hours a day, from Sunday night through to Friday night.
Our forex pairs are available to trade as contracts for difference (CFDs). When trading forex, you speculate on whether the price of one currency will rise or fall against another.
For example, if you choose to trade GBP/USD (British pound/US dollar) and you think the value of the GBP will rise against USD, you go long (buy). If you think GBP will fall against USD, you go short (sell). If your prediction is correct, you make a profit. If your prediction is incorrect, you would make a loss. Remember, losses can exceed deposits.
Forex is always traded in currency pairs, for example EUR/USD. The first currency (EUR) is called the ‘base currency’. The second currency (USD) is known as the ‘counter currency’. The way currencies are displayed shows us how many units of the counter currency you can buy with one unit of the base currency. This is the exchange rate, or in other words, how many US dollars you can buy for one euro.
You can trade CFDs on over 300 currency pairs via our platform. Currency pairs can generally be divided into three groups: major, minor and emerging.
Most of these pairs contain the US dollar as either the base or counter currency. They are the most frequently traded. Major currencies pairs include EUR/USD, GBP/USD and USD/CAD.
Currency pairs which do not contain the US dollar are known as minor currency pairs. Examples include EUR/GBP, EUR/CHF, GBP/JPY and CHF/JPY.
Also known as exotic pairs, these are made up of a major currency paired with an emerging or small but strong economy. Emerging currency pairs include USD/NOK, USD/HKD and EUR/CZK.