What is a market maker?
A market maker provides a platform for foreign currency exchange for the customer.
Market makers know the current cost of investing in the market. They study the buy price and the sell price in foreign exchange. Market makers can help customers to reduce the chances of losing money in the market. They are neither an agent nor an intermediary.
Who are the market makers?
Banks or foreign exchange businesses like Easy-Forex® are examples of market makers. They buy and sell finance resources. They do not charge a percentage to serve each customer.
Do market makers go against a customer’s position?
Market makers work with customers. They buy and sell to people who want to enter the market. They always tell customers both rates: the buy rate and the sell rate. Market makers do not advise customers. Market makers do not act for customers. They help because they can give expert information about different finance positions. Market makers have good policy to reduce risk. Authorities guide the way market makers act.
Do market makers and customers have opposite interests?
Market makers always provide the buy price and the sell price. Customers always know both prices. Market makers are neutral. They do not try to increase their profit by decreasing the customer’s profit. The trade process is based on supply and demand.
Who can influence the market?
The forex market is huge, with trillions of dollars transacted daily and a constant online flow of information across the world. This makes it difficult for an individual trader (person or organization) to influence the market. Easy-Forex® gives you access to to this exciting market through its online trading platform.
How does Easy-Forex® make profit?
With foreign exchange, there is a different price to buy and to sell. This difference is called the ‘spread’ and it is where Easy-Forex® earns money, making a small profit on each deal. Accordingly, Easy-Forex® maintains neutrality (as for the direction of any deals made by its clients), since the leading source of its income is in the spreads.
What is the risk for market makers?
Market makers deal with large amounts of finance and trade. They can combine all their client’s money and use banks to reduce risk. This is called hedging their exposure and by combining all the money, they hedge in bulk giving them a much stronger position. Easy-Forex® works within relevant international regulations as well as its own risk management policy. It cooperates with the world’s big banks: UBS (Switzerland) and RBS (Royal Bank of Scotland).
Source: Easy Forex