In Forex trading, individuals like you cannot enter the market on their own. There must be a middle man involved, this middle man is known as a Forex broker (similar to a stock broker).
A forex broker is usually a registered company or financial house that accepts trading requests from individuals and then performs these trades on behalf of the individual for a commission.
For example, let us say you, as an individual wish to buy the currency pair (also called instrument) of USD/JPY on the Forex market. This is how it happens: You inform your broker that you wish to buy so and so quantity of USD/JPY, your broker then connects to the main Forex market and executes this trade on your behalf (i.e. buys the currency pair that you specify). When you are now ready to sell this currency pair, again you notify your broker who performs the actual trade on your behalf.
Now I’m sure you are probably wondering how you are expected to communicate with your broker. You may also be wondering if all this back and forth communication between you, the broker and the market is not going to be tedious and time wasting because in Forex trading, a delay of as little as 0.1 second can prove disastrous.
Well, wonder no more because this is where the trading platform comes into play.
