Forexviðskipti

Forexviðskipti, also known as foreign exchange trading or simply Forex, refers to the global market where currencies are bought and sold. It is the largest and most liquid financial market in the world, with trillions of dollars traded daily. Participants in the Forex market include central banks, commercial banks, investment firms, hedge funds, and individual retail traders. The primary purpose of Forex trading is to profit from fluctuations in currency exchange rates.

Currencies are traded in pairs, such as EUR/USD (Euro/US Dollar) or USD/JPY (US Dollar/Japanese Yen). When a trader buys one currency in a pair, they are simultaneously selling the other. The exchange rate represents how much of one currency is needed to purchase another. For example, if the EUR/USD exchange rate is 1.10, it means that one Euro can buy 1.10 US Dollars. Traders aim to predict whether the value of one currency will rise or fall against another and place trades accordingly.

The Forex market operates 24 hours a day, five days a week, starting on Sunday evening and closing on Friday evening, due to its global nature and the involvement of financial centers across different time zones. Trading occurs over-the-counter (OTC) rather than on a centralized exchange, meaning transactions are conducted directly between parties. Factors influencing currency prices include economic indicators, political events, interest rate decisions by central banks, and market sentiment. While Forex trading offers the potential for high returns, it also carries significant risks, and many retail traders experience losses.