Exotics – What is Exotics in forex?

What is Exotics?

Definition of Exotics: This is a term used for explaining currency that is not traded actively like the main currencies. USD, CAD, NZD, JPY, GBP, AUD, EUR and CHF are some of the main currencies. Currency pairs of the main currencies are generally recognized as minor or major to make a distinction. Moreover, the aliens tend to be the money of rising countries and are generally not traded in an easy manner in a standard account. The countries falling in this group generally have weak infrastructure, balance of the payment deficits, regular devaluations and unbalanced economies. Generally, the dealers of Forex trading market do not create markets in the Exotics except currency speculation. Because of the high risk, illiquidity and shortage of market depth, Ask or Bid spreads is liable to be very huge and therefore, very costly for a Forex entrepreneur also.