Forex, also known as foreign exchange or FX, is the simultaneous buying of one currency while selling another. The forex market is available 24 hours a day, five days a week and it’s one of the largest, most liquid financial markets in the world. Just to compare, the New York Stock Exchange makes about $169 billion a day in volume and the Forex Market makes over $5 trillion a day in volume.
Forex is traded in currency pairs. Common currency pairs are the Euro/US Dollar, US Dollar/Japanese Yen, Great British Pound/US Dollar, and US Dollar/Canadian Dollar. You buy one currency and automatically sell another.
The Forex market is open 24 hours a day. It opens on Sunday at 10:00 pm GMT, and closes on Friday at 10:00 pm GMT: Sydney opens at 10:00 pm to 7:00 am.
It depends on the leverage and capital invested. You can have a starting capital of as low as $50, or as high you want. However, it is important to remember that increasing leverage increases risk; but ultimately depends on the investor's appetite for risk.
Forex trading is not centralized on an exchange, as with the stock and futures markets. The Forex market is considered an Over-the-Counter (OTC) or 'Interbank' market, due to the fact that transactions are conducted between two counterparts over the telephone or via an electronic network.
The Forex market is called an 'Interbank' market due to the fact that historically it has been dominated by banks, including Central Banks, commercial banks, and investment banks. However, the percentage of other market participants is rapidly growing and now the list includes large multinational corporations, global money managers, registered dealers, international money brokers, futures and options traders, and individual investors.