Reasons
Forex trading takes place for two reasons. First is the trading activity of governments and companies that buy or sell products and services in foreign countries accounts for about 5 percent of daily turnover. Speculation accounts for the remaining 95 percent. This type of forex trading goes on between investors who aim to make a profit on the difference between high and poor performance currencies. However, as the name suggests this type of forex trading can be compared to guess work as there are so many factors affecting a currency’s exchange rate on a given day that profits are not guaranteed.
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