Forex traders (foreign exchange traders) anticipate changes in currency prices and take trading positions in currency pairs on the foreign exchange market to profit from a change in currency demand. They can execute trades for financial institutions, on behalf of clients, or as individual investors.

Forex traders can be full-time professional traders who earn a living trading forex or part-time investors dabbling in forex for a side-income. These days forex traders typically work in front of a screen instead of in ‘the pits’.

A forex (FX) trader’s job is to buy a currency low and sell high to earn a profit. In the same way that a market trader selling fruit and vegetables buys the produce at a low price and sells it at a higher price, the same is done by speculators in financial markets. The market trader takes risk by doing this because they cannot be sure to sell all their produce and cover their costs, however the risk is generally well understood and the fruit and veg is priced appropriately.


The main difference is that when global forex market trading, currency traders don’t know whether they will be able to sell the currency they have bought at a higher price and make a profit or be forced to sell it at a lower price and make a loss. The forex trader must speculate which way the currency will go next using techniques like technical analysis or fundamental analysis.

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