Institutional or individual investors typically conduct trade in an equity market. However, a Forex market comprises other additional players whose reasons for exchange is different from the equity market.
A Forex market consists of four main players: the government and central bank, speculators, large financial institutions, and super banks.
The super banks determine the Forex exchange rates since Forex is a devolved market. These large banks come up with the offer and the asking price in the Forex market, depending on the demand and supply of currencies. They conduct a considerable amount of transactions daily.
Large financial institutions conduct exchanges with companies that transact with a lesser amount of money. They typically deal with companies that exchange currencies in the course of doing their businesses.
Governments and central banks also take part in foreign exchange. The government may take part in the forex market to facilitate international transactions and to handle the Forex reserves.
The central banks influence the forex market by altering the interest rates to control price changes, therefore, affecting the value of the currencies.
Speculators are the most participants in the Forex market. Speculators may join the Forex market with a good amount of money and others with just a little. Their main aim is to gain from the changes in the exchange rates.