Who are the Major Participants of Forex Trading Market?
Forex or foreign exchange market offers an opportunity to make more money with significantly low investments. The forex market is a market in which the people can buy or sell currencies by using other currencies. Forex trade activities are not controlled by any centralized market system; generally, the transactions are conducted through online broker platforms. The forex market has now become one of the largest liquid markets in the world, because of the huge amount of trading that can be done in twenty-four hours a day and throughout the week. The technological advancement brought about a lot of changes in the online trading market, very good example is the emergence of cryptocurrency but bitcoin code review to be done before investing these an option. Similarly, the currency trading transactions can now be done through electronic devices. Transactions can be conducted through computer networks in any place around the world. But in olden days the forex trading was conducted by some large financial institutions, banks, corporations, hedge funds and so on.
The Major Participants in Forex Trading Market
- Private or Commercial Banks
The banks are the financial institutions where we can deposit and get returns in form of interest from our savings. They also provide other services like loan facilities, different profitable savings schemes, locker facilities etc. But some private banks and commercial banks invest in the forex trading platform by using the money of the customers without permission, and thereby they make more profit for their institutions. This is the main reason that the bank doesn’t allow you to withdraw your balance in one day. The private and commercial banks make more profit by using these types of trading methods and they only provide a very low amount of annual return to their customers.
- Central Banks Swiss National Bank
The central banks in foreign exchange market are the Swiss National Bank, European central bank, United States Federal Reserve Bank, Bank of Japan, Bank of England. These banks can influence Forex markets in numerous ways. They also have an impact on the value of the currency by rolling huge amounts of money
Brokers are the mediator between investors and trading market. They charge a fee for their services, they help the investors to find out the best profitable investment options in the forex market.
- Hedge Funds
Hedge funds are a very common type of fund available in the online trading market. It is a kind of fund in which the investors invest their money and give permission to manage funds to one professional trader or group of traders. The hedge fund managers are mainly companies, banks who put a part of your money in different hedge funds. The professional hedge trader can guarantee a high yearly annual return for investments.