Pipruit: Sounds good. Look’s like it’s really simple. And how big is the FOREX market? I’ve heard from friend of mine, she’s a broker, that there are some markets that are illiquid. As she told me, “illiquid” means insufficient demand or supply volumes, i.e. low trade volume, so you can’t always find a willing buyer or seller. Does FOREX have the same problems? Commander in Pips: Well, I’ll show you… FOREX daily turnover was reported to be over 3.98 trillion US dollars in April 2010. Pipruit: What does it mean? Is that a lot or only a little compared to other markets? Commander in Pips: Do you know about equity markets and particularly about the New York Stock Exchange? What do you think, is the stock market large and liquid enough? Pipruit: I think so. When I watch business media, such as CNBC and Bloomberg, they talk about the stock market all the time – the S&P 500 is moving higher or the Dow Jones Index moving lower. They never say anything about people not being able to buy or sell. So that is a liquid market, I suppose. Commander in Pips: Oh yeah? And now look at this little chart I found for you - just compare the dollar value of daily turnover, son…FOREX is not just big compared to the stock market, it’s huge. Pipruit: Incredible! Commander in Pips: But don’t get too carried away. We trade Spot FOREX, not forwards, swaps and a lot of other stuff that you don’t understand yet. So, the share of retail trading, that spot trading also belongs to, is below the half of overall FX volume – approx. $1.5 trillion. But this is still more than enough, believe me… P.S. This lesson was written by Sive Morten, who has been working for a large European Bank since April of 2000, and is currently a supervisor of the bank's risk assessment department. Sive's knowledge of forex market and banking industry is vast and quite complete. If you have any specific questions about forex, banking industry, or any other financial instruments, please post them below, we'll notify Sive, and get them answered within 1 week.