Forex: What is traded?

What is Traded?

Duhhh~~~ The easiest and simple answer is MONEY. hahah. Don't you worry I'm just playing around.

Trading with money? Not like the old days where people trading gold, rice, etc. Because you’re not buying anything physical, this kind of trading can be confusing at some times.

To ease the confusing frenzy, you can think of buying a currency as buying a share in a particular country, kinda like buying stocks of a company but now your buying with a country. The price of the currency is a direct reflection of what the market thinks about the current and future health of the country's economy.

When you buy, say, the Japanese yen, you are basically buying a “share” in the Japanese economy. You are betting that the Japanese economy is doing well, and will even get better as time goes. Once you sell those “shares” back to the market, hopefully, you will end up with a profit. Can you get the idea? I hope you do.

In general, the exchange rate of a currency versus other currencies is a reflection of the condition of that country’s economy, compared to other countries’ economies.

Here are some of the list of all the major currencies and their respective nicknames.

Major Currencies

Symbol	Country	Currency	Nickname
USD	United States	Dollar	Buck
EUR	Euro zone members	Euro	Fiber
JPY	Japan	Yen	Yen
GBP	Great Britain	Pound	Cable
CHF	Switzerland	Franc	Swissy
CAD	Canada	Dollar	Loonie
AUD	Australia	Dollar	Aussie
NZD	New Zealand	Dollar	Kiwi

Well, you wouldn't want to see a full currency name in your trading or during reading charts do you? That is why there is a short form of them in symbols.Currency symbols always have three letters, where the first two letters identify the name of the country and the third letter identifies the name of that country’s currency. 

Take NZD for instance. NZ stands for New Zealand, while D stands for dollar. Easy enough, right?

The currencies included in the chart above are called the “majors” because they are the most widely traded ones.

For your info, we’d also like to let you know that “buck” isn’t the only nickname for USD.

There’s also: greenbacks, bones, benjis, benjamins, cheddar, paper, loot, scrilla, cheese, bread, moolah, dead presidents, and cash money. Okay I need to stop now. hahah.

So, if you wanted to say, “I have to go to work now.”

Instead, you could say, “Yo, I gotta bounce! Gotta make them benjis son!”

Or if you wanted to say, “I have lots of money. Let’s go to the shopping mall in the evening.”

Instead, why not say, “”Yo, I gots mad scrilla! Let’s go rock that mall later.”

Did you also know that in Peru, a nickname for the U.S. dollar is Coco, which is a pet name for Jorge (George in Spanish), a reference to the portrait of George Washington on the $1 note?

They call me Coco yo!

Previous post: Forex: What the heck is it?
Next Session: Forex: Currencies are traded in pairs? (in progress)