Covering the Basics of Forex

Forex is an acronym for the foreign exchange market; an investment market that handles the legal exchange of one currency for another. Accredited brokers track all legal currency transactions that occur on the exchange. This happens whether you are a consumer using traveler's checks, a forex trader, an investor involved in international business, or a financial institution exchanging currency.
International currency exchange happens every day. However, it only occurs legally when accredited by the CFTC (Commodities Future Trade Commission). Many unregulated exchanges that occur exist outside the forex, usually the result of individual investor trades. Although an unadvisable method, it does occur for many reasons.
The foreign currency market is an investment market, but differs from the New York Stock Exchange in several ways. Because it is part of the much larger international trade market, it is much more sensitive than the NYSE to global market factors. The slightest adjustment in the global market can have compounded effects, either positive or negative, in the foreign exchange market.
As the biggest market in the world, the foreign exchange market sees an average trading volume of more than US$2 trillion per day. The majority of the activity in the market comes from major financial institutions and multinational corporations, who trade large amounts of foreign currency. Individual investors account for a smaller fraction of market trade volume.
A key difference in the two markets is that forex does not have a centralized regulatory board like the NYSE. The foreign exchange market monitors numerous transactions through multiple accredited institutions, not a single regulatory board. Currency exchange occurs worldwide simultaneously.
For more information on forex, and foreign exchange market resources and training, visit the Colt FX website.
Colt FX is a site for people interested in investing in the forex. Newcomers can find valuable forex educational material. You can get started on your forex success by visiting http://www.coltfx.com.
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