|Global foreign exchange market turnover2 (Photo credit: Wikipedia)|
The exchange market helps those who want to international trade and investments by helping with currency conversion. It is also the carry trade. In a typical transaction, the group buys a quantity of one currency by paying a quantity of another currency.
Some of the reasons why the foreign exchange market is different is because of its geographical dispersion, the low margins of profit compared with other fixed income markets, and the leverage to enhance profit and loss margins.
As for the forex history, the modern foreign exchange market began to form in the 1970s after decades of government restrictions on foreign exchange transactions. In the 1980s trading grew more and the greatest proportion of trades was within the United Kingdom and the United States was second in trading. The top currency traders as of today are Deutsche Bank, Citi, Barclays Investment Bank, UBS AG, HSBC, JPMorgan, Royal Bank of Scotland, Credit Suisse, Morgan Stanley, and Goldman Sachs. Also, the most traded currencies by value today are United States dollar, Euro, Japanese yen, Pound sterling, Australian dollar, Swiss franc, Canadian dollar, Hong Kong dollar, Swedish krona, and New Zealand dollar.
So, as you can see the market is a good place to do trading with different currencies.