ForexMajor, minor and exotic currency pairs
Currencies are always traded in pairs. Which pair you trade affects your costs, how much the price moves and when it is most active.
How pairs are quoted
The first currency is the base and the second is the quote. The price shows how much of the quote currency buys one unit of the base. GBP/USD at 1.2700 means one pound costs 1.27 US dollars.
Why it matters
Majors involve the US dollar, which is on one side of most forex trades worldwide, so they usually have the tightest spreads. Exotic pairs can have spreads many times wider, larger overnight swaps and sudden gaps around political or central-bank news.
Retail leverage limits also differ: in the UK, EU and Australia, major pairs are capped at 1:30 and other pairs at 1:20.
Correlation
Some pairs tend to move together. EUR/USD and GBP/USD often rise and fall at the same time, while EUR/USD and USD/CHF often move in opposite directions. Holding several correlated positions can multiply your risk without you noticing.