The foreign exchange has been compared to an international casino that never closes. Of course, if you look at it from the day trader’s perspective, every market is little more than a casino. Fortunes are won and lost every day… and in some cases, every hour. Trillions of dollars flow through every exchange. It is up for debate whether that figure is closer to quadrillions, in the case of the Forex market. After all, with so much wealth being put in from all corners of the world, it would all but impossible for such a market not to swell up into an absolutely gargantuan size range. If it were anything but enormous, that would be cause for concern in and of itself.
But is the Forex market just gambling? Is it nothing more than taking out loans (in the form of margins), and then trading currencies based on nothing more than being enamored with a growth story (such as with Chinese Yuan) or with a perception of security and past performance (like the British Pound)? Or is there a more fundamental reason that can drive someone to want to invest in this manner? It’s not like you can collect dividends off of your currency holdings. Besides, does anybody really understand something as complicated as the interactions between all of the world’s economies, and by extension their currencies?
There is most definitely an aspect of gambling here. No human being can be the personal store house of enough wisdom and insight to be able to relate every currency on Earth to one another, and actually make consistently profitable trades in consequence. However, the Forex market is not a casino. After all, you actually have a real chance of making money through trading currency pairs. The house makes its money when you trade, regardless of whether you win or lose. So there is no one (besides whomever you are trading with) who has an agenda against you.