Excerpt from: Forex Training
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| August 21, 2007 | | What are cross currencies on the FX market | When forex trading on the currency market, you might come across the term "cross currencies," or you might see something like "on the crosses." Cross currencies on the FX market is merely a term to refer to currency pairs that do not include the U.S. dollar.
In the first days of forex trading, the market was mainly for corporations that needed to exchange currencies. And in the early days, everything had to be converted to dollars. So if you wanted to change Japanese yen to British pounds, you had to first change the yen into U.S. dollars, and then change those dollars into sterling.
Now, thanks to cross currencies and the rising popularity of the FX market, it is possible to trade the currency pair GBP/JPY, and other currency pairs, directly, without getting the U.S. dollar involved.
| Topic Tags: cross currencies, cross currencies FX market, currency pairs, exchange currencies, forex trading, forex trading cross currencies, FX market, GBP/JPY, Japanese yen, popularity FX market | |
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