Forex, or foreign exchange, is the largest financial market in the world. It is a decentralized market where currencies are traded 24 hours a day, five days a week. Trillions of dollars are exchanged every day, making forex a highly lucrative industry for traders and investors. But how many dollars are exchanged in the forex market on a daily basis?
According to a report by the Bank for International Settlements (BIS), the average daily turnover in the global forex market was $6.6 trillion in April 2019. This figure represents a significant increase from the previous report in 2016, which estimated the daily turnover to be $5.1 trillion. The increase is attributed to the growth of electronic trading and the participation of retail traders.
The forex market is a decentralized market, meaning that it is not traded on a centralized exchange. Instead, it is traded over-the-counter (OTC) through a network of banks, brokers, and other financial institutions. This makes it difficult to determine the exact amount of money that is traded in the market on a daily basis. However, the BIS report provides an estimate based on data collected from central banks and other financial institutions.
The report shows that the most traded currency in the forex market is the US dollar, which is involved in approximately 88% of all transactions. The euro is the second most traded currency, accounting for about 32% of daily turnover. Other major currencies include the Japanese yen, British pound, Australian dollar, and Swiss franc.
The forex market is open 24 hours a day, five days a week, starting from Sunday night to Friday night. The market opens in Asia, then moves to Europe, and finally to the Americas. This means that there is always a market open somewhere in the world, providing traders with the opportunity to buy and sell currencies at any time.
The forex market is highly liquid, meaning that there is a large amount of trading activity and transactions can be executed quickly. This makes it attractive to traders who want to enter and exit positions quickly. The high liquidity also means that traders can trade large volumes of currency without affecting the market price.
The forex market is a highly volatile market, meaning that prices can fluctuate rapidly in response to economic news, political events, and other factors. Traders use a variety of strategies to profit from these price movements, including technical analysis, fundamental analysis, and news trading.
In conclusion, the forex market is a highly lucrative industry where trillions of dollars are exchanged every day. According to the BIS report, the average daily turnover in the global forex market was $6.6 trillion in April 2019. The market is open 24 hours a day, five days a week, and is highly liquid, meaning that traders can trade large volumes of currency without affecting the market price. The forex market is a highly volatile market, and traders use various strategies to profit from price movements.
