Foreign Exchange (or FX) trading is the simultaneous buying of one currency and selling of another.
There are five 'Major' currencies;
- US Dollar (USD)
- Euro (EUR)
- British Pound (GBP)
- Swiss Franc (CHF)
- Japanese Yen (JPY)
How is FX quoted?
All currencies are traded as pairs and are quoted in terms of the US Dollar (USD) for example 'USD/AUD or US Dollar Vs Australian Dollar', or quoted in terms of each other (known as 'cross rates'), for example 'AUD/EUR or Australian Dollar Vs Euro'.
24 hour market
The FX market is a true 24 hour market and is the most heavily traded financial instrument in the world, with a daily average turnover of over US$3 trillion.
FX leverage
At CMC Markets FX is traded on margin, which means for a small outlay you can open up much larger position in the market. This is known as leverage.
Leverage on margin FX trades is typically 100:1
