Forex (foreign exchange) is best explained as a network of buyers and sellers exchanging currencies with each other for an agreed price. It is the way in which private investors, companies and central banks exchange one currency for another.
Although a large proportion of forex trades are executed for practical reasons, the majority are executed for the purpose of making a profit. The number of currencies exchanged daily can make the price movements of some currencies highly volatile. It is precisely this volatility that makes forex so attractive to traders: it gives them the chance to achieve higher profits.
What moves the Forex market?
The forex market is made up of currencies from all over the world. This can make it difficult to make exchange rate forecasts, because many different factors can contribute to price movements. However, forex, like most other markets, is mainly driven by supply and demand and it is important to develop knowledge about the influences on price movements that take place here.
Central banks play an incredibly large and important role in this market. The supply is controlled by central banks, which can announce measures that have a significant effect on the relevant currency price.
Setting up and maintaining Forex business
In these harsh times of covid and global economic crises, many companies are struggling to stay afloat. Some have failed and careers have suffered, especially when it comes to banking, taxes and regulations. But a few careers and businesses flourish, no matter the time.
The financial market is a sector that continues to do well, regardless of the global situation. The income of forex brokers was never affected by the difficult times as people continued to trade. In fact, most people believe that this is the best time to trade because the market is now more predictable.
Many people change careers and some venture into companies that can cope with the difficulties of our time. The financial market is one of these industries. If you’re considering a business as a forex brokerage company or example, there are a few things you should consider before you start this company and during its existence. Think of the company registration and incorporation, the costs of licensing, the remuneration of the liquidity providers and payment solutions.
Not only will DBi take all the necessary steps for you. DBi provides your company with a corporate legal structure that mitigates your tax burden and gives your company access to (central) banks globally. We consider all risks and processes with specialists before any steps are taken and we take care of registration, taxes, regulation, and everything else necessary for the forex business.
Contact our Forex specialist, Valentina Gorgis, at email@example.com for her expertise.