Overview
The foreign exchange market is more commonly known as the forex market. It is the financial market involved with the trading of currencies. It is the largest financial market in the world where trading volumes of more than $5 trillion occur daily.
These trades are executed over the counter, more commonly referred to as OTC. This means that transactions are executed around the world through online computer networks. In addition to being the largest market, the forex market is also the most liquid and volatile.
Liquidity refers to the ease with which an asset or a security can be converted into cash without it affecting its market price. Market volatility refers to the velocity of price changes which occur in any market.