If you read about investing, you’ve seen the word forex pop up. But because forex doesn’t get much publicity in the major publications and websites, many investors don’t know that forex is just short for “foreign exchange.” So trading the forex market is simply trading foreign currencies. As recently as ten years ago, currency trading had high barriers to entry, so only large banking and institutional firms had access to the tools and systems required to play in the forex game. Recently, however, technology has developed to the point that any individual investor can hop right in and trade with one of the many online platforms.

When buying and selling in the forex market, you’ll see that there are four “currency pairs” that dominate the percentage of trades. Those four are the Euro vs U.S. Dollar, US Dollar vs Japanese Yen, US Dollar vs Swiss Franc, and US Dollar vs British Pound.

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