Forex stands for “foreign exchange" and refers to the trading of global currencies. The forex market provides a way for traders to buy and sell different foreign currencies. You can trade U.S. dollars for Euros or Euros for Japanese Yen, for example. As industries, businesses, and manufacturing have become increasingly globalized, so has financial trading. The forex market is the largest in the world, with almost $7 trillion exchanged on a daily basis. Unlike stock and options trading, forex trading does not take place within an actual physical exchange that opens and closes, such as the New York Stock Exchange. Rather, forex trading takes place 24/7 in an over-the-counter, or OTC, market. Traded currencies show up in pairs, such as USD/EUR. Both individual investors and major financial institutions participate in forex trading.