Forex trading, or foreign exchange trading, involves the buying and selling of currencies on the global financial market. It’s the largest and most liquid financial market in the world, where currencies are traded in pairs, such as the US dollar against the euro. This market enables essential activities such as international trade and investments by allowing currency conversion.
How Big is The Forex Market
The forex market is enormous and continuously growing, with a daily trading volume exceeding $7 trillion as of 2022, according to the 2022 Triennial Central Bank Survey from the Bank for International Settlements (BIS). This makes it the largest financial market globally, significantly larger than stock markets. The market’s vast size and liquidity mean that it can absorb trading volumes and transaction sizes that dwarf the capacity of any other market.
Over the years, forex trading has increased in popularity not only among institutions but also among individual investors. This is evidenced by the proliferation of retail forex trading platforms and a significant increase in day trading activities. The ease of access to market data, educational resources, and online trading platforms has democratized forex trading, making it accessible to a broader audience worldwide.