Currency pair

Every forex trade is an exchange of one currency for another, so instruments are quoted in pairs: EUR/USD, GBP/JPY, AUD/NZD. Buying the pair means going long the base currency and simultaneously short the quote currency.

Pairs are grouped into majors (containing the US dollar and a large economy), crosses (no dollar, such as EUR/GBP) and exotics (a major against a smaller or less liquid currency). Liquidity, spread and typical volatility differ sharply between the groups.