Forex Market Participants

Back when the first forms of trading were created in the 17th century, the term of trading was mostly used and directed towards certain institutions. These entities will later become huge corporations and banks, which are still one of the main participants of the market. But it is quite important to note that they aren’t the only ones. Anyone can engage in the trading market today. No matter where you are from or have many or little experience you have, you are more than welcome.

Some platforms are more inclusive than others. When you dig deeper in researching different ones, you will notice that some are focused on the wealthy and well-established traders, and there is nothing wrong with that, of course. However, there is a whole vast of other trading platforms, that are aiming to include everyone, but especially the people who feel like they don’t have what it takes. Here we will present you the Stockscm review of a trading platform that does exactly that – empowers and encourages traders who were too intimidated to even try.

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Stockscm Platform

Stockscm platform aims to destigmatize the whole process by showing everyone how simple and exciting it can really be, if you dare to try. One thing is certain – Stockscm will never throw you into the ring of fire to fend for yourself! Rather, they make their priority to follow you and guide you through each step. That’s what they are here for – both good times and the bad ones.

While this all sounds quite sweet and satisfying, we decided to take it a step further and look into the ugly side – are there any Stockscm bad reviews? Is Stockscm a fraud, or are they legit? If you want to find out the answers, stick with us until the end of this article.


Decentralization of the Foreign Exchange Market

Forex is the most liquid and the largest decentralized market in the world. This, however, does not mean that chaos is rulling it! Rather, the actions of all its participants are affecting it at all times- from central banks to the individual traders. A special type of trading activity that is happening on this market is over-the-counter, or OTC for short.

Why is this market special? Well first, this is the only place where you can exchange currencies. And by that, we don’t mean that you go to an exchange service and replace one currency for another one. Instead, you aim to profit by predicting where will the currencies go next regarding their value. Will they rise or drop? How is the latest economic data aiming to help you understand that picture?

The Forex market is maintained by many financial institutions and entities that are engaging in the trading activities themselves. From banks to individual traders and dealers, we will cover each one of them in the following passages.


International Banks

Most of the world’s largest banks have noticed pretty early on how the market can work well in their favor. They started engaging in trading activities in order to try and gain profit. They do that by assessing all of the different assets on it – mainly currencies. This way, they can easily detect how is the economy of a certain country performing. From the employment rates to GDP, you can learn a lot about a country’s economy by looking at its currency.

On the Forex market, international banks serve as an anchor for other participants. Since this market is always open except for the weekends and major holidays, there is actually quite a lot to deal with during each trading day. Here is where the international banks are especially useful – they tend to create a balance within chaos, and refocus trading participants of what is really important – the act of currency trading.


Central Banks

Central banks are quite powerful entities within the world of economy and finance. They are the leaders of the country’s monetary system, especially in the tough times. Some of their roles include managing expectations by creating new policies and principles, as well as deciding on the interest rates. Depending on the current state of the market, different entities attempt to shift the focus of a certain central bank to their own problem.

However, central banks are free from any outside influence. Rather, they take into consideration many different factors. These include anything from the currency value to the global health condition, but never an individual, selfish influence of a single entity or a party. Central banks are in charge of balancing the hardships within each state’s economy, in hopes of keeping it afloat and functioning for all its citizens.


Market Dealers

In other words, the dealers are the market participants that are making sure that each trade is going on as efficiently and as smoothly as possible. They are the people you turn to when you want to open your position. They do all of the paperwork and other administrative parts of trading that you usually don’t see or think about when you’re trading.

Dealers are they ones who assess the relationship between the two currencies, just like you. Currencies on Forex are usually traded in pairs and that’s how you will find them – USD/JPY, for example. On the other hand, each currency has its own value, which is an index. You can trade indices, as well, but Forex is dealing mostly with the currency pairs trading.

It is quite important to note that international banks can often take on a role of a dealer. This way, they operate behind the scenes for your benefit, which many experts refer to as an “interbank market”. The main reason why different entities are taking on different roles is because there are so many things going on at once. This way, market participants are contributing to the well-functioning of the market at any time.


Commercial Companies

While these companies typically trade a smaller number of accounts compared to the big banks, they still carry an important role within the world of finance and trading. Each trade that they execute this way has a rather small and short-term effect on the global market, but that doesn’t mean we should take it lightly. After all, the first forms of trading were created mainly on largest companies. Over time, their role somewhat decreased and was implemented into other important parts of the market functions.


Investment Management Firms

Unlike the commercial companies, these firms are focusing on managing bigger accounts. These are usually pension funds and other types of long-term savings, as well as accounts of traders which are focusing on their long-term goals.

Furthermore, these firms are typically managing large accounts which means that they are buying and selling several currency pairs at the same time for a single portfolio. This may sound simple but can easily become quite hectic during a single trading day. This is why it takes an entire investment staff of a department to manage these accounts.


Money Transfer Companies

These types of companies are managing the trades made by the people who are outside of their country, but are attempting to make trades in relations to it or its national currency. You may know them as the remittance companies, and the volume of the trades they make per year sometimes go up to several hundred billion.

The four largest markets in this area are Mexico, India, China and the Philippines. On the other hand, the largest entity that deals with most of these transactions is the well-known Western Union. These companies allow you to access the world’s markets through them. This way, you won’t have to deal with any additional paperwork. Other headaches that you may stumble upon along the way – leave them to the dealers!


You – a Trader

Who did we forget? Oh, that’s right! You, reading this!

Each one of us can become a trader, which is the beauty of today’s trading. It is not exclusive anymore, or reserved for the wealthiest. Rather, anyone can join and try their luck. This is what made the Foreign Exchange market even more appealing over time – its welcoming attitude and inclusivity.

No matter how long have you been in on the action, or if you are just contemplating dipping your little toe in – you are more than welcome to try. Today, the platforms such as Stockscm are attempting to pull you in and keep you interested through learning, among other things. They do this by providing many useful educational tools, tutorials and analysis. This way, you can engage with the analysts and experts as well as other traders. Accordingly, you can then plan your trading journey.

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