What is the difference between trade and forex, and can you explain TOM, cash, and spot transactions in the context of trading?

Question

Accepted Answer

Trade involves buying/selling goods, while forex focuses on currency exchange. TOM, cash, and spot are transaction types in trading.

Trade refers to the exchange of goods and services, while forex (foreign exchange) is specifically about currency trading.
TOM (Tomorrow) transactions are agreements to exchange currencies at a specified rate, with settlement occurring the next business day.
Cash transactions involve immediate exchange of currencies at the current market rate, settled instantly.
Spot transactions are similar to cash but typically refer to trades settled within two business days, based on current market rates.

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