What Are Exotics?

Exotics are a currency pair group that consist of a currency from an emerging economy or a currency from a small country with a small developing economy. Examples would include Euro Turkish Lira (EURTRY), US Dollar Turkish Lira (USDTRY), US Dollar Mexican Peso (USDMXN), US Dollar South African Rand (USDZAR), US Dollar Singapore Dollar (USDSGD). Compared to Crosses and Majors, Exotics are much riskier to trade because they are less liquid, more volatile, and more susceptible to manipulation. They also contain wider spreads, and are more sensitive to sudden shifts in political and financial developments.

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