Whether you call it Forex, FX or the foreign exchange market, you are playing the same game. When it comes down to basics, currencies are being traded based on speculation and trends. Beginning close to forty years ago, forex is unique in that it is not related to the profits of any particular business. It is strictly a forum where people buy and sell the currencies of different countries.

For starters, FX outpaces the stock market in trading. Close to $2 trillion is traded everyday in this market. For those not acquainted with the different markets, this is a massive amount, far greater than what is traded on any particular country’s stock market. FX is the biggest game in town. It draws all the big players, from the wealthiest of banks to entire governments.

An interesting feature regarding the FX market is the liquidity of what is being traded. Money is money, and can therefore be easily converted into any particular form of cash you might like. The FX market is fast-paced and high risk. A lucky investor could easily make out big. On the other side of the coin, however, one’s savings could be wiped out very rapidly.

Moreover, the FX market is a global entity. Any particular stock market is limited to its country of origin, and is founded on the companies and profits found in that country. The FX market is more of a global thermometer. It signals the ebb and flow of the global market, and the relative standing of the world’s respective currencies.

While the stock market is regulated with fixed operating hours that follow the holidays and workweek of a particular country, the FX market is a wild 24 hour phenomenon. National holidays for one country might not mean anything for another, and because of varying time-zones, no block of time can be fairly set. When one country is waking up, the other is going to sleep. By staying open at all hours, the FX market evens the playing field.

Lastly, stock markets are based on the currency of the country of origin. Currency actually has nothing to do with stock markets, besides for how the FX market might be affecting the countries particular businesses. The FX market and the many alternative stock markets are completely different games. They are related in the sense that money is being exchanged based on speculation, but after that similarity, the relationship ends. When you buy into a stock, you are buying a small piece of ownership of a company. When you buy a currency, you get just that, ownership over so many units of a country’s currency.