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What Are Forex Pairs

What Are Forex Pairs

Though most transactions are not done virtually the money involved is very real indeed, and because a lot of these transactions involve buyers and sellers of different nations and companied the international element is present. Thus, the need to transact using duel currency or otherwise known as forex currency pairs.

The Pairs

Basically it means buying stocks in one currency and then simultaneously selling the same already purchased stock in another currency. Both these currencies will be clearly stipulated alongside each transaction for the perusal and knowledge of both buyer and seller.

Some of the more commonly used pairs are often divided into two categories of major and minor currencies. Major currencies are the most popularity used traded currencies which are USD, EUR, JPY, GBP, CHF, CAD and AUD, while NZD and ZAR are considered the minor currencies.

There are also circumstances that don’t require the common forex pairs to be used and instead other parings are allowed such as the replacement of USD with EUR, GBP, or AUD against other currencies. These types of transactions are commonly known as quote currency exchange. Among the more popular pairings are: • EUR – USD • USD – JPY • GBP – USD • USD – CHF • EUR – CHF • AUD – USD • NZD – GBP And a few others

These forex trading pairs are a general trading tool for the many currencies of the world and are currently rising as the largest and least regulated market providing the greatest liquidity to inverters globally.

Simply put, it is buying a certain currency or commodity at a lower rate and then when there is a currency fluctuation that is advantageous to the seller then they said purchase is sold for a profit. Some consider this type of trading to be very volatile and risky but if done well the profits can be rather significant.

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