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This Presentation Explains Everything You Could Want to Know About the FX Market

The foreign exchange market is as complex as it is large and the presentation below provides a very concise overview of playing participants, dynamics and transaction methods across the business.

It never seems to shock us how few people have even a deep simple understanding of the market in which they are trading. When it comes to the Forex market, retail investors are at the bottom of the barrel in terms of information and tools, proven over and over again through return statistics.

Below you will find a concise summary of everything from market depth to the manner in which dealers interact, as well as definitions for commonly overlooked terms. A while back, one of our good friends introduced me to the work of Carol Osler, a professor of finance at the Brandeis International Business School. I have read a wide range of academic papers over the years discussing order flow, microstructure, etc., but I have never found one this concise in terms of discussing the foreign exchange market as a whole.

I respect the straightforward and nonsensical manner in which this paper was written, which essentially draws an outline of the market from a bird's eye view. Last week I was ready to post a quick link to this article, when I thought it would make better sense if I just created a brief presentation that outlines key sections and points. The presentation is essentially a verbatim translation of what is posted in the research paper, just simply broken down into a more visual manner with key points exposed. I have never blatantly asked this before but if you find this in any way useful, please share it. It is one of those things that simply deserves more attention.

You can alternatively download a copy of this in .pdf format (with active links to sources and much better quality) by clicking here.