Retail Foreign Exchange Trading (Retail Forex)

Retail foreign exchange trading refers to the trading of currencies by individual investors (retail traders) through online platforms. Unlike institutional traders, who may trade large volumes of currency in the interbank market, retail forex traders typically trade smaller amounts and use leverage provided by brokers. Retail forex trading is conducted via platforms that offer access to currency pairs, allowing traders to speculate on currency price movements, often using tools like margin and leverage to amplify potential profits or losses.

Example

An individual investor uses an online forex broker to speculate on the movement of the EUR/USD currency pair, making trades based on technical analysis and economic news.