The forex funding market is one of the most popular markets, with forex traders worldwide trading day or night. One might wonder why forex traders are so interested in this market? The answer is simple: because they can make money from it!
Since forex trading is a significant part of the global economy, it’s no surprise that forex funding methods are also widely used. It can be done through three types of forex brokers: currency exchange brokers, forex banks, and ECNs (Electronic Communication Networks).
1) Currency Exchange Brokers- These brokers receive orders from clients in the form of a buy or sell order and then execute those orders by matching them with other orders on their books or elsewhere. They may also trade against their customers’ positions by going short or long in particular currencies.
2) Forex banks – They are typically large investment banks that offer forex trading services to institutional investors, as well as retail customers who want exposure in their portfolios.
3) ECNs (Electronic Communication Networks). ECNs are forex market participants that facilitate the buying and selling of currencies by matching buy and sell orders.
Forex funds have been changing hands for decades now, and new types of funding are being introduced every day, making it hard to keep up with what’s available.