The Stock Market, Forex Market & Cryptocurrency Market
Introduction
In this blog I’ll be talking about the forex market, Stock market and Cryptocurrency market and the media attention they receive now, and just generally defining each market.
Body
The foreign market exchange (forex) is made up of made up of banks, companies, centralised banks, investment management firms, hedge funds, and forex brokers and investors, it is the largest financial market in the world. The forex market is one that is dominated by a global network of computers and brokers from various locations around the world. The forex market is made up of two levels, the interbank and the over-the-counter market. in the interbank market large banks trade currencies for various purposes, like on behalf of clients for example. In the otc market individuals trade online through brokers and different platforms.
The forex is notorious for being a 24-hour market that doesn’t close from one end of the world to the other, a different system from other markets like bonds etc. Although it is rare, there is exceptions. The us dollar, as expected is the most traded currency by a mile with 88% of all traded in previous years (2019 most notably) with the euro at 32% of all trades in the same year, and at third is the Japanese yen with 17%. As the worlds largest economy this is not unusual but just shows how much the us dominates this stage. JPMorgan chase and co are also very heavy investors in the forex market showing just how mainstream the forex market has gotten in the past ten years.
The foreign exchange market allows multiple entities/participants to use its marketplace and buy, sell or exchange, two of these are banks and individuals. It is not 24/7 but is open 24 hours 5.5 days a week, and trades trillions each day.
Stock markets are important components of a free-market economy because they allow democratized access to trading and exchange of capital for all types of investors, they also perform several functions in markets, including efficient price discovery and efficient dealing. The stock market refers to the collection of markets and exchanges where regular activities of buying, selling, and issuance of shares of publicly held companies take place, the first stock exchange to ever exist in the world was the London stock exchange back in 1773. Stock exchanges also use otc (over the counter) marketplaces that operate under a strictly defined set of regulations, but there can also be multiple stock trading venues in a country/region that allow transactions in stocks and possibly other forms of securities.
In recent years crypto currencies have emerged as very popular markets with people from all backgrounds and ages hoping to indulge in the profit that things like bitcoin supposedly bring, crypto markets are like forex and stocks in the sense that values work the same mostly and its accessible, even though stocks require a decent capital to invest, forex and crypto can be tapped into with as little as $10. Now I would say among the youth and under thirties cryptos dominate the scene when it comes to trading markets due to their accessibility and mainstream attention due to companies like tesla investing into things like bitcoin which encourages the public to invest for returns or just because of the coverage said market is getting at the time.
Conclusion
To conclude, I would say all markets are similar in the sense that people expect a return and market values are somewhat similar, but also different in the sense that forex is currency pairs mostly, stocks is m ore of a formal thing, then you have the cryptocurrency market which is wildly diverse as its coverage is unbalanced in my opinion. But during covid especially I would say they’ve all had a fair amount of media attention, with crypto currencies being just a bit more popular now. And I think this supports the blog page due to its main centre point being markets and robin hood/gme’s viability due to said situation.