Why, when and where you should trade the Forex Market

By: Invezz
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on Sep 27, 2019
Updated: Jan 3, 2020

Everyone you talk to in the U.S. has always been all about the stock markets. While these may appear to be the most popular investment markets in town, the truth is that they are overwhelmingly dwarfed by the world FOREX, or Foreign Exchange Markets. Stocks may have their following, but they trade less a trillion dollars volume on a really busy day. Forex markets put that to shame in their sleep, trading in excess of $5 trillion per day, per the Bank of International Settlements’ 2013 triennial report. That represents a 32.3% volume increase over the 2010 daily Forex transaction figures. Dare to dream, stock markets.

While the majority of this trading is carried out by enormous operations, such as hedge funds, central banks, and global banking institutions on behalf of their own accounts and for wealthy customers, individuals like you are also able to trade world Forex markets. It is not even expensive for a regular person to get started. In fact, you can open a Forex account and make small trades with as little as a thousand dollars. Try doing much stock trading with a thousand bucks.

Where are the major Forex trading centers located and why does it matter?

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The thing that makes the world of Forex markets so exciting and vibrant is that they are based in many different international centers around the world. Eight of these handle most of the volume around the globe. When you open a Forex account, it will likely trade on one of these exchange centers, depending on what time of the day that you transact. This is why the Forex markets never sleep, because when one center such as Australia is signing off for the evening, another center such as London or New York is opening up shop. Because of this, the Forex markets are the only financial markets that trade six days a week, 24 hours per day, over 360 days per year. Among the major world Forex trading centers are some cities that will not surprise you much and also a few that may take you aback. Here they are in order:

1. London, United Kingdom – with over $2.7 billion daily Forex turnover, Great Britain and the world’s unrivalled financial currency center London control 41% of the daily foreign exchange volume. Britannia may no longer rule the waves, but she certainly still rules the world’s greatest financial market, with more than double the market share of the number two world Forex center. Whichever your Forex broker is, it will have an office or representatives in London, you can bet on it.

2. New York, USA – at $1.3 billion daily turnover volume from an average daily market share of 19% , the Big Apple and Stars and Stripes can still claim to be number two in this most vital of global financial markets.

3. Singapore, Singapore – with $383 billion in average daily turnover, Singapore controls 6% of the world’s Forex volume. They have recently leapfrogged ahead of Tokyo and Japan since the 2010 report update. In fact, Singapore has become the Asian Forex center of choice for many brokers opening up Asian Forex offices. It seems the world’s busiest port is also a good place to transact currency exchange.

4. Tokyo, Japan – their $374 billion in daily turnover volume is good for about 6% of the world’s market share. This makes Tokyo and Japan the number four Forex center. You might not have guessed they would be big in financial exchange, but apparently the Japanese are not just good at making cars, machinery, technology, and sushi.

5. Hong Kong – Hong Kong continues its tradition of being a major FOREX global center with $275 billion in average daily volume for 4% global market share. That’s an increase of 15.5% over the 2010 numbers for this Mainland Communist China dominated city-state of seven million people.

6. Zurich, Switzerland – At $216 billion in average daily turnover, the world’s most famous, neutral, safe haven country controls 3% of the world market total. This performance actually means that Switzerland has slipped several spots in the top eight ranking. With the downfall of their once-secretive private banking industry, it has been a tough few years for the Swiss.

7. Paris, France – With $190 billion in daily global foreign exchange turnover, Paris and France hold roughly 3% of the world Forex market share. The French are surely celebrating having moved up from number eight to number seven. The Swiss had better watch their backs.

8. Sydney, Australia – The land down under boasts $182 billion daily FOREX turnover for almost 3% of the world market share total. This is still a one slot drop for the Aussies from their 2010 position ahead of France.

The good news about Forex trading for novices is that you do not even have to trade yourself anymore. After 2008, manual trading systems rapidly gave way to Forex trend signals and Forex robots. Unsurprisingly, these trend signal systems provide signals on which you can trade. Even easier still are the automated Forex trading algorithms that will do all the work for you once you setup your maximum loss per trade and maximum trade size. The Forex trading market has been dominated by these trading robots and trend signal systems since 2012/2013.

Where to buy right now

To invest simply and easily, users need a low-fee broker with a track record of reliability. The following brokers are highly rated, recognised worldwide, and safe to use:

  1. Etoro, trusted by over 13m users worldwide. Register here >
  2. Capital.com, simple, easy to use and regulated. Register here >