London Session
Also known as the European session, one of the three trading sessions that keep the forex market open 24 hours a day.
Related terms
GMT (Greenwich Mean Time)
The reference point for all time on Earth, chosen in 1884 due to the maritime importance of Greenwich, London. FX market hours are often quoted in GMT.
Read full definitionForeign Exchange Market (Forex, FX)
The global market for the movement of capital from one currency to another. The FX market is unique for its global nature, the volume of transactions taking place, the myriad factors affecting exchange rates and the use of leverage to enhance profit and loss.
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Spot Rate
The current market exchange rate at which one currency can be bought or sold for immediate delivery. Spot trades typically settle two business days later (T+2).
Read full definitionForward Contract
An agreement to exchange a set amount of one currency for another at a fixed rate on a future date. It locks in today’s rate, protecting a business from adverse currency moves before a payment falls due.
Read full definitionFX Swap
The simultaneous purchase and sale of the same amount of a currency for two different value dates, typically a near leg at spot and a far leg forward. It is used to roll a hedge forward or manage short-term cash-flow timing.
Read full definitionCurrency Pair
Two currencies quoted against each other, such as GBP/USD. The first is the base currency and the second the quote currency; the price shows how much of the quote currency one unit of the base is worth.
Read full definitionBid-Ask Spread
The difference between the price at which the market will buy a currency (bid) and the price at which it will sell (ask). A tighter spread means lower transaction costs.
Read full definitionPip
The smallest standard increment by which a currency pair moves, usually the fourth decimal place (0.0001). Pips are the common unit for quoting spreads and price movements.
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