Course Content
What Is Forex Trading?
Forex is the world's largest market by trading volume and liquidity. Brokers, businesses, governments, and other economic agents trade currencies and forex derivatives to enable international commerce. Traders also use the market for speculative reasons. There are various arbitrage opportunities to be found with exchange rates and interest rates, making the market a popular one to trade in large volume or on leverage. The forex market consists of fiat currency pairs and their relative market prices. These pairs are typically bought and sold by the lot. A standard lot contains 100,000 units of the pair's base currency, but other smaller sizes are available, ranging down to 100 units. Traders commonly use leverage to increase the amounts they can invest with their capital. You can also offset risk by using forwards and swaps to trade a currency pair for a specific price in the future. Combining these two instruments with other trading strategies and products creates a variety of investment opportunities for forex traders.
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What Is Forex Trading?
About Lesson

Take, for example, the EUR/USD pair with a 1.400 rate. The interest rate for deposits in the Eurozone is 1%, whereas it’s 2% in the USA. So €100,000 invested in the Eurozone will give you back €1,000 in profit after a year. However, if you could invest the money in the USA, it would provide you with €2,000 in profit if the exchange rate holds. However, this simplified example doesn’t take into account fees, banking costs, and other expenses you should also factor in.

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