Players Of The Forex Market
The forex market has become so decentralized with liquidity running up to five trillion worth of Us dollars, at its early stages the market had so few players only Big institutions and few retailers made the supply and demand , with a lot of players getting involved including brokers of all types the Forex trading is gaining unimaginable momentum. Individuals can now participate in the market including Africans ,there are brokers who provide services targeting the market in these parts of the world.
The government plays an important role in maintaining a balance in the foreign exchange market. It is the policies of the central banks that determines interest rates of countries, the increase or decrease in the countries currency value is determined by controlling the supply. Foreign reserves can be used as well to put a balance in the market.
It is the commercial banks that takes care of the forex transaction, most banks especially the large players they trade amounts in billions, there are companies that trade for large banks and other banks sometimes trade on behalf of their customers.
These are the investment firms that do mange significant portfolios for their clients, they use the forex to facilitate the transaction of foreign securities. Investors use forex market to buy and sell currencies to be able to settle foreign securities bills they would want to purchase.
A hedge fund is a pooled investment fund that trades in relatively liquid assets and is able to make extensive use of more complex trading, portfolio-construction and risk management techniques in an attempt to improve performance, such as short selling, leverage, and derivatives
People can exchange money on their own when you change from one currency to another you are participating in the foreign market exchange. The general populace can as well participate on the exchange though brokerage and online platforms.
Companies needs foreign exchange market to settle their goods and services bills from foreign countries and also to sell their various products, companies plays an important role as they trade their shares on the market and also the more they gain value the more the prices changes on the market in terms of stocks.