FOREX, MARKET MEMBERS
forex, fx, credits, loans, currency
foreign exchange market
The Forex market is an international market directly between two parties (OTC). This means that it is a market that is decentralized and self-regulated Exchange central office or clearing house, as opposed to the futures and stock markets. This structure eliminates the cost per Exchange and compensation, in such a way that it reduces the costs of operations.
Forex direct is composed of different members, with needs and varied interests, operating directly between them. These participants can be divided into two groups: the interbank market and the retail market.
The interbank market
The market interbank appoints them transactions of currency that is produced between them banks central, banks commercial e institutions financial.
Central banks – national central banks (such as the Federal Reserve of the United States or the European Central Bank) play an important role in the foreign exchange market. As director of the Monetary Authority, its function is to achieve price stability and economic growth. To do this, they regulate the supply of currency in the economy through the imposition of rates of interest and the lace. It also manages the currency reserves of the country which can be used to influence the conditions of markets and exchange rates.
Commercial banks – commercial (such as Deutsche Bank and Barclays) banks provide liquidity to the foreign exchange market because of the volume of commercial transactions dealing with every day. These operations include the conversion of currency according to the needs of customers, while some held for speculative purposes by owned banks negotiations tables.
Financial institutions – financial institutions, such as the managers of finance, investment funds, pension funds and companies which operate with foreign currency as part of their obligations in order to find the best investment opportunities for its clients. For example, a manager of international equities portfolio and will have to carry out the operations of foreign currency for the purchase and sale of the foreign force.
The retail market
The retail market designates transactions between small speculators and investors. These operations are performed through the corridors of currencies acting as mediators between the retail market and the interbank market. The members of the market to the retail are funds coverage, companies and individuals.
Hedge – hedge funds funds are private investment funds that speculate with various kinds of goods by means of leverage. Macro hedge funds are intended to seek business opportunities in the market of Forex and operations designed and executed after a macroeconomic analysis that examines the challenges facing a country and its currency. Due to their high liquidity and their aggressive strategies, are considered a large contributor to the dynamics of the currency market.
Societies – These represent companies engaged in the activities of import and export with their foreign currency pairs. Its main business requires the purchase and sale of foreign currency in Exchange for goods, exposing them to risks. Through the currency, these converts foreign currency market and are covered against future fluctuations.
Individuals – investors or private operators operating in Forex with its own capital to profit from speculation on future exchange rates.