What are Foreign Currency Exchange Rates

The simplest definition of foreign currency exchange rates is the rate at which one currency, such as U.S. dollars, can be traded for another. As these currency exchange rates fluctuate constantly, there is considerable opportunity to earn money from the differences - called "arbitrage."

There are online sites that show currency exchange rates in real time where traders, or travelers, can check exchange rates.The market through which investors trade in foreign currencies is called the Forex market.