How a Forex system operates in real time
Online foreign exchange trading occurs in real time.
Exchange rates are
constantly changing, in intervals of seconds. Quotes are
accurate for the time
they are displayed only.
At any moment, a different rate may be quoted.
When a trader locks in a rate and executes a transaction,
that transaction is
immediately processed; the trade has been executed.
Up-to-date exchange rates
As rates change so rapidly, any Forex software must display
the most up-to-
date rates.
To accomplish this, the Forex software is
continuously
communicating with a remote server that provides the most
current exchange
rates. The rates quoted, unlike traditional bank exchange
rates, are actual
tradable rates. A trader may choose to “lock in” to a rate
(called the
“freeze
rate”
) only as long as it is displayed.
Trading online on Forex platforms
The internet revolution caused a major change in the way
Forex trading is
conducted throughout the world.
Until the advent of the internet-Forex age at the end of the
1990’s, Forex
trading was conducted via phone orders (or fax, or
in-person), posted to
brokers or banks. Most of the trading could be executed only
during business
hours. The same was
true for most activities related to Forex, such as making
the deposits necessary for trading, not to mention profit
taking. The internet
has radically altered the Forex market, enabling around the
clock trading and
conveniences such as the use of credit cards for fund
deposits.
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