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Forex Services – Forex Trading, Currency Exchange, Hedging and Risk Management
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1.
What is the primary purpose of hedging in forex trading?
To maximize profits
To speculate on currency fluctuations
To reduce the risk of adverse currency movements
To avoid paying transaction fees
2.
Which of the following is a commonly used financial instrument for hedging foreign exchange risk?
Equity Futures
Forward Contracts
Government Bonds
Exchange-Traded Funds
3.
What does the term "currency pair" mean in forex trading?
A combination of two countries involved in trade
The ratio of two interest rates
A quotation of two currencies traded in the forex market
A set of exchange rates offered by a broker
4.
Which of the following is the largest and most liquid financial market in the world?
Stock Market
Commodity Market
Forex Market
Bond Market
5.
Which term refers to the difference between the bid price and the ask price in forex trading?
Leverage
Margin
Spread
Pip
Submit Test
These questions are part of Banking Awareness - 2025-26 course in GKToday's Android Application. The Course comprises 2400+MCQs on Banking & General Financial Awareness with explanation for All Banking Exams of 2025-26 such as IBPS Bank PO, IBPS Bank Clerical, RRB PO and Clerical, SBI PO and SBI Clerical, IBPS Recruitments, RBI Grade B and RBI Banking Examinations.
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