Foreign Exchange (forex or FX) is that the trading of 1 currency for an additional . for instance , one can swap the U.S. dollar for the euro. exchange transactions can happen on the exchange market, also referred to as the Forex Market. The forex market is that the largest, most liquid market within the world, with trillions of dollars changing hands a day . there's no centralized location, rather the forex market is an network of banks, brokers, institutions, and individual traders (mostly trading through brokers or banks).
Foreign exchange are often as simple as changing one currency for an additional at an area bank. It also can involve trading currency on the exchange market. for instance , a trader is betting a financial institution will ease or tighten monetary policy which one currency will strengthen versus the opposite .