What Is Forex?
Wat is forex?
The foreign exchange market: the world's largest and most liquid financial market.
Leer hoe de valutamarkt werkt, wat valutaparen zijn en hoe wisselkoersen tot stand komen.
Definition
Forex (foreign exchange, or FX) is the global marketplace for trading national currencies against one another. With a daily trading volume exceeding $7.5 trillion, it is by far the largest financial market in the world. Forex trading involves simultaneously buying one currency and selling another.
How Forex Works
Currencies are always traded in pairs. The first currency is the base currency and the second is the quote currency. The exchange rate tells you how much of the quote currency you need to buy one unit of the base currency.
The forex market operates 24 hours a day, 5 days a week, across major financial centers: London, New York, Tokyo, and Sydney.
Major Currency Pairs
| Pair | Name | Characteristics |
|---|---|---|
| EUR/USD | Euro / US Dollar | Most traded pair globally; tight spreads |
| GBP/USD | British Pound / US Dollar | "Cable"; can be volatile |
| USD/JPY | US Dollar / Japanese Yen | Influenced by interest rate differentials |
| USD/CHF | US Dollar / Swiss Franc | "Swissy"; safe-haven currency |
| AUD/USD | Australian Dollar / US Dollar | Commodity-linked currency |
| USD/CAD | US Dollar / Canadian Dollar | Influenced by oil prices |
Key Concepts
- Pip: The smallest price move in a currency pair, typically the fourth decimal place (0.0001). For JPY pairs, it's the second decimal (0.01).
- Spread: The difference between the bid (sell) and ask (buy) price. This is the broker's fee.
- Leverage: Forex brokers offer leverage (e.g., 50:1 or 100:1), allowing you to control large positions with small capital. This amplifies both gains and losses.
- Lot size: Standard lot = 100,000 units; mini lot = 10,000; micro lot = 1,000.
- Swap/rollover: Interest paid or earned for holding positions overnight, based on interest rate differentials.
What Moves Forex Markets?
- Interest rates: Central bank decisions (Fed, ECB, BoJ) are the primary driver.
- Economic data: GDP, employment, inflation, and trade balance reports.
- Geopolitical events: Elections, wars, trade agreements.
- Market sentiment: Risk-on vs. risk-off flows between currencies.
- Commodity prices: Affect commodity-linked currencies (AUD, CAD, NOK).
Risks
- Leverage risk: High leverage can wipe out your account quickly. A 1% adverse move with 100:1 leverage means a 100% loss.
- Volatility: Major news events can cause sudden, large price moves.
- Counterparty risk: In the OTC (over-the-counter) forex market, your broker is your counterparty.
- Gap risk: Prices can gap over weekends when markets are closed.
Key Takeaways
- Forex is the largest financial market, trading currency pairs 24/5.
- Currencies are quoted in pairs (base/quote); profits come from exchange rate movements.
- Leverage amplifies both profits and losses significantly.
- Interest rates and economic data are the primary market drivers.
- Most retail forex traders lose money — education and risk management are critical.
Definitie
De forexmarkt is de markt waar valuta's worden verhandeld. Het is de grootste financiele markt ter wereld met een dagelijks volume van meer dan biljoen.
Valutaparen
- Valuta's worden altijd in paren verhandeld: EUR/USD, GBP/JPY, etc.
- De eerste valuta is de basisvaluta, de tweede de quoteringsvaluta.
- Majors: Paren met USD (EUR/USD, GBP/USD).
- Crosses: Paren zonder USD (EUR/GBP, AUD/NZD).
Wat beweegt wisselkoersen?
- Rentetarieven: Hogere rente trekt buitenlands kapitaal aan.
- Economische data: BBP, werkgelegenheid, inflatie.
- Geopolitiek: Politieke stabiliteit en handelsrelaties.
Belangrijkste punten
- Forex is de grootste financiele markt ter wereld.
- Valuta's worden in paren verhandeld.
- Hefboom is gebruikelijk maar verhoogt het risico.
- Rentetarieven en economische data zijn de belangrijkste drijfveren.