A Look at Forex Market Makers

The investor in the currency market takes for granted that a pair of currencies can be bought or sold at a moment's notice. Once an order is placed with a broker, the trade is executed within seconds. It is, of course, not as easy as that.

Whenever a pair of currencies is bought or sold, there must be someone at the other end of the transaction. It is very unlikely that the investor will always find someone who is interested in buying and selling the same two currencies at the same amount, and at the same time. Hence, the question remains, "How is it possible that the forex investor can buy or sell at any time?" This is where the forex market makers come in.

The forex market maker is a bank or brokerage company that stands ready, every second of the trading day with a firm bid and ask price. This is good for the investor because when the investor chooses to buy and sell a pair of currencies, the market maker will purchase from and sell to the investor, even if they do not have a buyer and seller lined up. In doing so, they are literally "making a market" for the currencies.

Forex market makers ensure that the market is always functional and that the currencies in it will always fetch the market rate. Forex market makers do so by updating their prices at intervals of at least 30 seconds and undertaking to trade if this is requested. Forex market makers must fulfill their obligations irrespective of whether the economic situation is favorable or unfavorable, or whether they lose or profit by doing so.

Typical forex market makers include Gain Capital, CMS Forex, Forex Capital Markets (FXCM), and Global Forex Trading, all of which are regulated by the Commodity Futures Trading Commission (CFTC) of the USA. Another prominent forex market maker is Saxo Bank, which is regulated by the Financial Services Authority (FSA) of Denmark.

Until recently, central banks, commercial banks and investment banks dominated the forex market. Due to the entry of forex market makers, other market players like international money brokers, large multinational companies, registered dealers, global money managers, and private speculators have entered the market in large numbers.

Forex Brokers Info provides detailed information on forex brokers, forex trading and market makers, and other forex-related topics. Forex Brokers Info is the sister site of Incorporating in Florida Web.

CNBC
Asian currencies lower against dollar
Economic Times, India - Sep 6, 2008
Yuzo Sakai, currency trading manager at Tokyo Forex and Ueda Harlow, predicted before the Labor Department report that the yen could rise again. ...
Yen Drops Most in 3 Months as US Takes Over Fannie, Freddie Bloomberg
* Dollar dips vs euro, but up vs yen on GSE bailout plan guardian.co.uk
Gold loses its glitter Business Standard
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The Moscow Times
Central Bank Acts to Stem Ruble Slide
The Moscow Times, Russia - 10 hours ago
08 September 2008The ruble recovered on Friday from a historic trough after the Central Bank said it would not allow the currency's trading band to widen, ...
Ruble Rises Against Currency Basket After Central Bank Steps In Bloomberg
Russian assets tumble amid worries about ruble MarketWatch
Big Summer Sell-Off Hits the Russian Stock Market New York Times
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Forex – Currency Trading Absentee
Corsavoo.com, France - Sep 6, 2008
Such tools include the various type indicators applied against a FOREX chart for the desired currency pair. Depending on your risk tolerance, you may decide ...
Profitable Forex Trading Strategies Corsavoo.com
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Forex Signal Service Providers Corsavoo.com
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Jordan's mufti issues fatwa against electronic currency trading
Monsters and Critics.com - Sep 6, 2008
... the trading of currencies on the internet after scores of citizens went bankrupt, suffering big losses in currency trading with foreign markets. ...

Wall Street Journal
$A opens higher as risk appetite returns
Sydney Morning Herald, Australia - 9 hours ago
By 0747, it had risen further, trading at $US0.8332/8336. Over the weekend offshore session, the local currency moved between a high of $US0.8278 and a low ...
Video: Obama Calls for Changes in Mortgage Giants AssociatedPress
Asian Stocks Rally, Treasuries Drop on Fannie, Freddie Takeover Bloomberg
= Asian Stocks Rise, Yen Falls On Freddie, Fannie Bailout News Trading Markets (press release)
Forbes - Barron'sall 5,177 news articles

Stay prepared for breakout
Business Standard, India - 15 hours ago
Action in the new currency trading segment suggests that market expectations are in the range of Rs 44.80 to the dollar by the end of the month. ...

India Infoline.com
Defining the role of currency futures and other derivatives
Economic Times, India - 10 hours ago
India launched exchange-traded currency derivatives the other day and on the first day of trading, the exchange handled $60 million. ...
NMCE to re-launch coffee futures tomorrow Hindu Business Line
India gold futures higher on commodities mkts boost Reuters India
Brisk start for FX futures trading on India’s NSE but scope is ... Futures Options Week
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Japanese market advances, Nikkei up 2.8%
RTT News, NY - 5 hours ago
In currency trading, the US dollar rose into the mid 108-yen level on Monday following the news of the bailout of troubled US mortgage finance firms Fannie ...
Euro Open: Fannie, Freddie and Ike Send US Dollar Lower Daily FX
US Dollar Holds Strong Despite Jump in Unemployment Rate to 5-Year ... Daily FX
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KBS
Gov't to Ease Foreign Currency Trading Rules
KBS, South Korea - Sep 5, 2008
Most forms of personal foreign currency trading under ten-thousand dollars will be permitted starting next year. The Ministry of Strategy and Finance said ...

Fannie-Freddie bailout whets hunger for risk
International Herald Tribune, France - 1 hour ago
Dealers in the currency market scrambled to sell yen for just about every major currency after last week knocking down the euro to the lowest in a year ...

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A Look at Forex Market Makers