| In the frenzied world of currency trading, where daily trading volumes exceed $5 trillion, tight trading spreads are the norm for deals between banks in the interbank market, with only a few “pips” separating the bid and ask prices for a currency. Exchange rates quoted by banks to their large corporate, institutional and government clients are also very competitive, with narrow spreads. But it is an entirely different story as far as retail clients are concerned.
The spread between the bid and ask price for a currency in the retail market is usually quite large, and may also vary significantly from one forex dealer to the next. Since this difference in rates can have quite an impact on your wallet, it is always in your interest to shop around for the best exchange rate. But first, let’s delve into the world of forex to get a basic understanding of how exchange rates are calculated and how you can interpret them...............................................Full Article: Source
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