Market participants use forex to hedge against international currency and interest rate risk, to speculate on geopolitical events, and to diversify portfolios, among several other reasons.
Major players in this market tend to be financial institutions like commercial banks, central banks, money managers and hedge funds.
Global corporations use forex markets to hedge currency risk from foreign transactions.
Individuals (retail traders) are a very small relative portion of all forex volume, and mainly use the market to speculate and day trade.
The foreign exchange (also known as FX or forex) market is a global marketplace for exchanging national currencies against one another.