This is the Reason :
- 2-way market movements in either direction to deliver benefits to investors. For example, if you want to benefit from the price rise by the following example, if the exchange rates of GBP / USD now is 1.5000 which means that 1 GBP worth at $ 1.5. If you currently have a capital of $ 1500 and has predicted that the exchange rate of EUR / USD goes up, then all you have to do is buy (BUY) GBP / USD or buy GBP using USD, meaning that you will exchange dollars into pounds. Of your capital worth $ 1500 it will get GBP currency of 1000 pounds, and suppose that within 1 business day exchange rate GBP / USD rose to 1.6000 then you are doing now is to make the sale (SELL) GBP / USD or exchange back 1000 pounds your dollar. As a result after back exchange, the money which you hold will be $ 1600 (1000 x 1.6) with a total profit of 100 USD. Similarly, the benefit from the price drop.
- Given the level of liquidity and high price movements, foreign exchange or forex trading is becoming a popular alternative because the rate of return on investment and profits get is more than the average trade in general.
- Banks (Inter-Bank Money Market / Money Market) is fulfilling the needs of the velocity of money in the business and the needs of the transaction by speculators on a daily basis to reach a value of trillions of dollars.
- Central Bank of a country is one of the holders of a significant role in the foreign exchange market. The central bank is always trying to control the money supply, inflation or interest rates and often they have a target both official and unofficial exchange of money in the country. The central bank would use its foreign exchange reserves to stabilize the movement of foreign exchange in the market.
- Business World is one of the important roles in the movement of foreign exchange due to the need of the company's activities in making payments for goods or services that they do.
- Investment Management Company or commonly called investment managers on behalf of clients such as pension funds and foundations contributed funds traded on the foreign exchange market for foreign currency needs in order to buy shares abroad. Transactions conducted by the investment management company is not done with the purpose of speculation or in order to obtain maximum profit.
- Hedge Funds is an investment company which carries speculative transactions to benefit such a great character that we may know that George Soros whose reputation rose due to currency speculation does aggressively since 1990.
- Foreign Exchange Broker is a company founded specifically to conduct brokerage services for its customers in the fields of financial markets by gaining a reward for his services.