Noob Question(s)

[FOREX.com]

Mainly how does a transaction work in the sense that …the open of a transaction is clear, you propose to buy x sum of dollars in exchange for euro…but in order to close a deal doesn;t it have to exist a mutual consensus of the closing of a deal.

Hi @alexslabu23,

The ability to trade forex 24 hours a day 5 days a week is the service your broker provides you. This is similar to how your supermarket provides you the ability to buy groceries (though you can’t sell groceries back to them ) during store hours.

Supermarkets buy groceries from their suppliers at wholesale prices and sell them to you at retail prices. Similarly, forex brokers are able to buy and sell currency pairs at institutional prices, and offer you the ability to trade with them at retail prices.

how exactly can you instantly close a transaction all by yourself , don t there have to be at least 2 people willing to close a deal (at the same time)…this boggles my mind.

Retail forex brokers can manage the risk on the other side of your trades in one of three ways, and each method has its pros and cons. We explain them further in this earlier discussion: Who is the counterparty in an exchange?