The Basic Facts Of Foreign Exchange
The foreign exchange market is called forex. If you exchange greenbacks for EU bucks at you bank, your bank bundles your transaction with other transactions and trades them on the forex market. The idea is to get the most favorable rate of exchange. In this manner your bank intends to earn a profit on your transaction. Forex exists to facilitate international investments and trade. If you went to Europe with dollars, you could not spend them. Global firms have the same problem, so foreign exchange exchanges the currency.