The Main Market Participants - Part III

Currency exchanges

Among some countries with transitive economies, there are currency exchanges which are there to both arrange exchanges and to formulate a market’s rate of exchange. Their Governments usually regulate the level of rate of exchange.

Currency brokerages

Their function is to introduce a buyer to a foreign currency seller and effect a loan-deposit  transaction. For this service, brokerage firms ask for a commission - usually as a percentage of the deal amount.

Private persons

Individuals arrange a wide spectrum of non-trade operations in the areas of foreign tourism, wages, pensions, fee transactions, buying/selling of cash currency, etc.

In 1983, with the creation of margined trades, the ability to invest spare funds in the FOREX market for profit became a viable option for individuals.

The majority of FOREX transactions (90-95%) are arranged by international commercial banks; their own transactions as well as those of their clients.

Advancements in computer technology within the financial sphere has opened the way for private and small investors as more brokerage firms and banks allow access for private investors to FOREX via the Internet.