Online Forex Trading with Motilal Oswal in India | Get Started Now

1. MEANING OF FOREIGN EXCHANGE Foreign exchange refers to two things:  a) a foreign currency b) an exchange rate. The acquisition of foreign money in India, such as the dollar, euro, or yen, is known as foreign exchange. & Another facet of foreign exchange is the exchange rate, which is the price of one currency in terms of another currency. Forex Trading is the name given to the international market for the free exchange of currencies. Traders place buy orders for one currency and sell orders for another.

2. FOREIGN EXCHANGE MARKET The foreign exchange market is where national currencies are exchanged for each other. The key players in this sector include commercial banks, forex brokers, approved dealers, and monetary authorities. The foreign currency market has a major speculative component in addition to the transfer of funds from one country to another. It is the process of exchanging one currency for another.

3. TERMS RELATED TO FOREIGN EXCHANGE Foreign exchange reserves are the holdings of other countries' currencies. Foreign exchange controls are government-imposed limitations on the acquisition and trade of foreign currencies. Individuals trading foreign exchange speculatively on computerised trading platforms (retail foreign exchange platform). The risk of losing money due to a change in the value of one currency versus another is known as foreign exchange risk. International trade refers to the exchange of goods and services across national borders. A foreign exchange company is a broker who provides currency exchange and overseas payments. In the foreign exchange market, a currency pair is a quote of the relative value of one currency unit against another currency unit. Market makers that convert fiat currency for electronic money are known as digital currency exchangers.

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