Currencies are traded in dollar amounts called “lots”. At 100:1 leverage, one lot is equal to $1000 which controls $100,000 of a given currency. This leverage is known as “margin” and some brokers will allow traders even higher leverage than 100:1. This superhigh leverage is one of the reasons that Forex trading has become so popular.
Currencies are always traded in pairs. Each pair has unique notation that expresses which currencies are being traded.
The symbol for a currency pair will always be in the form ABC/XYZ. ABC/XYZ is not a real currency pair, just an example of how currency pairs are stated in the market. I
n this particular example, ABC is the symbol for one country’s currency and XYZ is the symbol for another country’s currency.
Listed below are some common symbols used. There are symbols for other currencies as well, but these are the most commonly traded ones.
USD - The US Dollar
EUR - The currency of the European Union "EURO"
GBP - The British Pound
JPN - The Japanese Yen
CHF - The Swiss Franc
AUD - The Australian Dollar
CAD - The Canadian Dollar
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