What is the difference between trading and speculation in the foreign exchange market?

**: It mainly refers to the import and export of commodities, and when it comes to foreign currencies, it involves the issue of exchange rates, which is mainly reflected in the hedging of currencies.

Investment: Mainly through the exchange rate changes, play a role in value-added preservation! For example:

Now that the European debt crisis has affected the exchange rate of the euro, if investors want to hold foreign currencies, if they expect the euro to fall, then they choose to sell the euro and buy safe-haven currencies such as the dollar and the yen.

Speculation: This type mainly refers to the fluctuation of the exchange rate, ** operation, fast in and fast out, to achieve the purpose of arbitrage.

Of course, it is not absolute, like investment, sometimes the operation is fast, and it is similar to speculation!

Foreign exchange market. At present, there are many kinds of financial commodity markets in the world, but they can be summarized into: ** market, interest market (including bonds, commercial papers, etc.), ** market (including **, platinum, silver), ** market (including grain, cotton, oil, etc.), option market and foreign exchange market.

The foreign exchange market refers to a trading place engaged in foreign exchange trading, or a place where various currencies are exchanged with each other. The forex market exists because:

and investment.

Importers and exporters pay one currency when importing goods and receive another currency when exporting goods. This means that they receive and pay in different currencies when they close their accounts. As a result, they need to convert some of the currency they receive into a currency that can be used to purchase goods.

Similarly, a company that buys foreign assets must pay in the currency of the country concerned, and therefore it needs to convert its national currency into the currency of the country concerned.

Venture. The exchange rate between the two currencies changes with the change in supply and demand between the two currencies. A trader buys a currency at one exchange rate and sells it at a more favorable rate, and he makes a profit.

Speculation accounts for the vast majority of transactions in the forex market.

Hedge. Due to fluctuations in the exchange rate between the two underlying currencies, companies with foreign assets, such as factories, may be exposed to some risks when converting these assets into the home currency. When a foreign asset denominated in a foreign currency remains unchanged in value over a period of time, a gain or loss occurs when the value of the asset is translated into the domestic currency if the exchange rate changes.

Companies can eliminate this potential profit or loss through hedging. This is the execution of a foreign exchange transaction in which the result of the transaction is just offset by the profit or loss of a foreign currency asset arising from the change in exchange rate.

The history of the foreign exchange market as an international capital speculation market is much shorter than that of the **,**,**, interest market, however, it has developed rapidly at an astonishing rate. Today, the daily trading volume of the foreign exchange market has reached trillions of dollars, and its scale has far exceeded that of other financial commodity markets, and has become the world's largest single financial market and speculative market today.

Since the birth of the foreign exchange market, the exchange rate of the foreign exchange market has become more and more volatile. In September 1985, 1 dollar was worth 220 yen, and in May 1986, 1 dollar could only be exchanged for 160 yen, and in eight months, the yen appreciated by 27%. In recent years, the volatility of the foreign exchange market has been greater, on September 8, 1992, 1 pound to the dollar, November 10, 1 pound to the dollar, in just two months, the pound against the dollar exchange rate has ** more than 5,000 points, depreciation of 25%.

Not only that, but at present, the daily exchange rate volatility in the foreign exchange market is also increasing, and it is common for the exchange rate to rise and fall by 2% to 3% in a day. On September 16, 1992, the pound fell 5% against the US dollar from ** to the pound.

Any investment that does not create value is speculation What do you think forex is Financial derivatives Speculation is greater than investment.

Very simply, foreign exchange is much fairer than the currency circle, and it can be bought up and down, transparent and open financial products.

You can buy up and buy down. State endorsement.

Is forex speculation good or bad? It cannot be generalized that there are risks in the foreign exchange market, and most importers and exporters and banks are reluctant to take risks, but are willing to pass on the risks to speculators, who thus become an important part of the foreign exchange market. On the one hand, foreign exchange speculators have played a positive role in preventing excessive fluctuations in exchange rate rates and maintaining market vitality; On the other hand, excessive speculation is prone to disrupt the financial order.

For example, Singapore's Lisson made a speculative mistake that led to the collapse of the Bank of Bahrain.

The investment in foreign exchange trading is indeed quite obvious, especially in the area of income, but we must choose a good exchange before making an investment, which is very necessary, I looked for a lot of exchanges from the foreign exchange WikiEye, there is more information, and it is also very foreign exchange WikiBit free to help users ** and recover Many users have successfully recovered good choices.

1. Low fees: The fees for foreign exchange transactions can be very low. There are virtually no commission fees, and most brokers make a profit from forex spreads.

As a result, traders do not have to worry about additional brokerage fees. The brokerage structure of **or other** transactions is quite different, and traders have to consider various additional fees.

2. Suitable for a variety of trading modes: The foreign exchange market runs all day long, and traders can choose a convenient time period to trade. This couldn't be more suitable for short-term traders, as they tend to trade in a matter of minutes or hours.

3. High liquidity: Compared with other financial markets, the number of participants in the foreign exchange market is very large, which also makes the liquidity very high. No matter how large the order is, it can be quickly digested by the market.

This also greatly avoids manipulation and chaos, while low spreads also contribute to more efficient pricing. Investors don't need to worry too much about high volatility at opening or closing times, or stagnant volatility in the afternoon. And these are the most common phenomena.

4. No ** exchange: The foreign exchange market is an over-the-counter market, so there is no ** exchange or regulator. Many central banks only intervene when necessary, but this is also uncommon and only occurs during extreme market times**.

And these extreme markets are usually predicted by the market, and they have changed. This decentralized and unregulated marketplace is able to avoid any sudden shocks. And in **, if a company unexpectedly announces a dividend or the company loses money, then the stock price changes dramatically.

Insider trading in the foreign exchange market is still very rare, because there are no insiders in the foreign exchange market.

As a financial investment market, the foreign exchange market has the commonality with other financial investment products such as ** and **, and also has its own advantages in the nature of investment.

First of all, the foreign exchange trading time is uninterrupted The foreign exchange market has become a round-the-clock market. Only in the week.

6. The foreign exchange market will be closed on Sundays and major holidays in different countries. This going concern provides investors with an ideal place to invest without time and space barriers, and investors can find the best time to trade.

Secondly, the zero-sum game In the foreign exchange market, the value change represented by exchange rate fluctuations is completely different from the ** value change. This is because the exchange rate refers to the exchange rate between the currencies of two countries, and a change in the exchange rate means that the value of one currency decreases and the value of the other rises.

Over-the-counter market trading This type of forex trading market without a unified site is known as a market without a market. The global forex market trades trillions of dollars on average every day. Such a huge amount of money will be liquidated and transferred in such a place where there is no concentration, no ** settlement system control and no ** supervision.

Free market Forex is probably the largest market in the world, with an average daily trading volume of trillions of dollars, which is 46 times that of all ** markets combined! There are a lot of people around the globe who trade forex and can't even control their currencies.

I also know this problem, WikiFX is quite good.