The 4 Key Players in the Forex Market

When trades are conducted in the equity market, they are normally conducted with institutional investors (e.g. mutual funds) or other individual investors. The Forex market operates differently in that there are additional players who trade for reasons that are different from that of the equity market. So for the purposes of educating the newcomers to the Forex market, the following is about the four key players in this arena.
Governments and Central Banks
Without a doubt, it could be strongly argued that the governments and central banks of the world's countries are the big players in the Forex market. Normally, the central bank is an extension of that country's government, and will usually formulate and regulate policy in conjunction of the government. There are governments that disagree with this, feeling that a centralized bank should be more of independent entity. The reasoning is that it could be more effective in the areas of curbing inflation rates and keeping interest rates down in the hopes of stimulating ongoing economic growth. But the government officials would still have the right to regular consulting privileges for the purpose of discussing monetary policy despite the banks independent platform.

Banks and Other Financial Institutions
Despite the depth of influence that governments and central banks exhibit, regular banks and other types of financial institutions are still a key factor in the Forex market in that they are available for those individuals who need to swap currencies in a small-scale type of transaction. So, they will deal with the neighborhood or local banks. However, these smaller scale transactions can't compare to the volume of the transactions that are conducted within the Forex market. Oftentimes referred to as the interbank market, this is the area wherein larger banks conduct transactions with other similar banks as well as determine the exchange rates that traders see on the trading platforms. Electronic brokering methods that are based on credit transactions are the means with which these trades are conducted. Only those banks that have an established credit based relationship with one another can be involved in this type of activity.

Hedgers
Businesses dealing in international transactions are usually the banks biggest clients. Whether a client is purchasing from or selling to an international client, the transaction will always be subject to the volatility factors that influence the exchange rate. And if there is one thing that management or shareholders despise, it is the uncertainty factor. Normally, these individuals will offset this uncertainty by entering the spot market and make an immediate transaction to purchase the currency that they need.

Speculators
Speculators are another market participant involved in the Forex market. Speculators usually will attempt to make monetary gains by taking advantage of fluctuations in the exchange rates rather than hedging against the rates or exchanging currencies to fund their transactions. Hedge funds are considered to be some of the largest speculators in the Forex market. They are also considered the most controversial. A good analogy that was once used to describe hedge funds was "mutual funds on steroids."

[ForexGen Money Manager]

An individual who is responsible for the entire financial portfolio of another individual or another entity. A money manager receives payment in exchange for choosing and monitoring appropriate investments for the client.

Benefits of being a Money Manager with [ForexGen]:

* Providing three different commission sources.
* Weekly commission plan.
* Easy & fast commission withdrawals.
* Fixed percentage of the profits.
* P = k * D “P=Profit, k=Variable Parameter, D=Deposits”

The money manager gets a fixed percentage of the profit previously agreed upon with the client for managing the client funds as a bonus feature.

The most competitive trading conditions:

* 2 pips spread on six currency pairs.
* Providing online trading services without maintenance margin, margin call and no automatic closing of positions below the initial margin on weekdays for accounts with initial equity of up to $1 million US. The margin level have to be recognized Fridays at 23:00 CET and before public holidays.
* Leverages up to 1:200 for accounts up to $1 million US.
* Liquidity and 24/5 availability are the characteristic factors of the Forex market compared with other financial markets.