To answer this question you need to understand what is forex, why it was created and what are its main functions. I hope you all like history. So, first currency trading took place in ancient times. But it’s not the point. I want you to come back to gold standard time.
A gold standard is a monetary system in which the standard economic unit of account is based on a fixed quantity of gold. After the Bretton Woods conference in 1944, some changes were done. The role of gold was severely constrained, as other countries’ currencies were fixed in terms of the dollar. Well, it didn’t help much for the global economy and international trade.
The new era for foreign exchange began after President Nickson offered to foget about fixed rates and stick to the free-floating currency system. That was just a great decision. Importers and exporters become market participants, conversion (and as result transactions) became much faster and it boosted their business and economy. Central banks got an opportunity to influence its currency and support economy this way. To keep it simple, forex is an instrument for global (international) trade. Another important function is the regulative.
As you see it is all about the global economy and international trade, not about retail traders like me and you. Speculative function appeared much later. Absolutely ather question is if you can make money there or if your broker is trusted. But come on, guys, its other story. Broker doesn’t mean forex.
Good trading to all!
Hi! My name is Inna. I turned $10k into $3 millions in a few years of trading. I am here to share my success and help you to become financialy free. You are welcome to my website!