Forex or Fx is one of the investment instruments! Forex stands for Foreign exchange or the exchange rate of foreign currency! Some people do forex trading because they are interested in the potential return or a large and fast return on profits! but some people do forex trading because of needs, or as a risk management style so that the business they run can avoid big losses!
Just call an airline that is engaged in export-import! they trade forex because to avoid fluctuations in forex movements! Because if the currency they use in business activities moves too far, their losses can be very large! Even so, if the forex movement is in accordance with what they expect the profits they get can be doubled!
But some companies do not want to be in that position or in a position of uncertainty, and depend on the market! because if so, at any time, their company might go out of business! and on this basis, some export-import companies have the initiative to find a safe position, by trading forex! This strategy is commonly referred to as hedging or hedging against volatile movements!
But there are also several agencies or individuals who carry out forex trading activities to make a profit! this is usually called speculation! Basically, for trading or forex transactions, there are many brokerage companies, as third parties that help retail traders to be easier in making this investment! , just call FXCM company, Alpari, Oanda and so on!
The brokerage company, you could say as a third party, offers a lot of conveniences! This happens because banks are unlikely to meet the flexibility of investors, such as the many choices of forex instruments, or commonly known as pairs! Broker fees are cheaper than banks! or customer service, of course, the broker will be much better! considering banks cannot do this, because the bank already has a product that has been set! in other words, the brokerage company can offer a better offer in terms of accommodation!