Gold has always been a major investment, whether the economy is stable or not; but it is when it is volatile that many investors turn to gold over stocks or bonds. This seems to suggest that during times where it can be impossible to predict what the economy will do, gold is a safe choice of investment.

There are several factors which contribute to the image of gold as a ’safer’ investment than stocks. This is largely due to the fact that it has proven itself in the past to hold its value throughout large-scale economic crises. Even at the time of the Great Depression and the Second World War, gold continued to consistently hold value while stocks and bonds plummeted. This proven consistency is a huge factor in the decision of many investors to choose gold to avoid large losses.

Forex market is where currencies get traded. Those who involve in this trade are the financial institutions, governments and speculators. The financial institutions include international banks, central banks, corporations and other institutions. The exchange of currencies is carried out when currencies are traded amongst each other through sales. The rate of exchange varies from time to time. The trade takes place at the rates that prevail at the time of the transaction. Currency trading has become an important global economic activity. Currency trading emerged as a distinct and important economic activity in the 1970s. About US$4 million is traded in the Forex market every day. Half of the currency traded thus is by speculators. Trading in currencies takes place because of the need to trade in goods and services between countries that have different currencies.

The global economy is experiencing a rapid growth of the foreign exchange market. There is an impressive growth in investment and trade in the Forex market. More players are into Forex trading. The beliefs and thinking of the players too influence and impact the Forex market in the way investment and trading takes place. If the investor loses confidence on any destination or country or currency, the investor will pull out the investment from the country or currency, and invest some where else or some other currency where the trader and investor have more confidence. There could be many reasons why the investor loses confidence. It may be because of political instability. Or it may be financial instability. One can see that vast sums of money simply flee into some offshore accounts. A favorite safe haven for many is Switzerland. The secrecy laws related to banking, bank accounts and transactions have earned the confidence of many. Swiss Franc as a result has been a steady and strong currency.

The global daily turnover in the forex market is estimated to be US$4 million. Of this, just over half are actually in speculative trading. All round the year, the major currencies are traded across the world. The trading is based on the exchange rates which fluctuate all round the year. It is the governments, international banks, the large banks and other financial institutions that trade in forex besides the forex traders. The forex market has seen rapid growth since it emerged way back in the 1970s. It is the investment managers who normally take decision on what and how much should be traded. They will have to go through all the numerous figures that keep flashing by in order to take wise decision. This is hard work. They will have to look at the figures, digest them and forecast how these figures are going.

Investments often are speculative investments. Investments are said to be speculative if the investor does not make adequate assessment of the financial assets on which investments are made or if the investor is interested only in short term gains through fluctuations in its price. Such investments have a higher risk as the short term fluctuations in the price of the financial asset does not necessarily reflect its real value.

Money is but a symbol to which we have given a value. It represents the value of goods and services. Before money was invented, products and services were exchanged directly. This exchange was called barter. You sell a good to a person who has a good that you need. This means of transaction was cumbersome. Money became the medium through which business and trade was transacted. When you sell a good you get money in return with which you can buy what you need. It made trade and exchange of products much easier. Money underwent change in its forms through history, from coins made of precious metals such as gold, silver and copper to bank notes or currency. Now digital money or virtual currency is also being used as a medium of transactions.