Thursday, October 19, 2006
1:06 PM
mistrack
there are three main reason to participate in the FX market.
one is to facilitate an actual transaction, whereby international corporations convert profit made in foreign currencies into their domestic currency. corporate treasurers and money managers also enter the FX market in order to hedge against unwanted exposure to future price movements in the currency market. the third and more popular reason is speculation for profit. in fact, today it is estimated that less than 5% of all trading on the FX market is actually facilitating a true commercial transaction.