Fungibility is different from liquidity. A product is liquid if it can be easily exchanged for money or another different product. On the other hand, a product is fungible if one unit of it is substantially equivalent to another unit of the same product of the same quality at the same time and place.
For example, different issues of a government bond which may have been issued at different times are fungible with one another if they carry precisely the same rights and any of them is equally acceptable in settlement of a trade.
Another example is diamonds. Diamonds are not perfectly fungible because diamonds’ varying cuts, colors, grades, and sizes make it difficult to find many diamonds with the same cut, color, grade and size. Fungibility does not imply liquidity, and vice versa. Diamonds can be readily bought and sold, as the trade is liquid, but individual diamonds, being unique, are not interchangeable.
HIGH RISK WARNING: Foreign exchange trading carries a high level of risk that may not be suitable for all investors.
Leverage creates additional risk and loss exposure. Before you decide to trade foreign exchange, carefully consider your investment objectives, experience level, and risk tolerance.
You could lose some or all of your initial investment. Do not invest money that you cannot afford to lose. Educate yourself on the risks associated with foreign exchange trading, and seek advice from an independent financial or tax advisor if you have any questions.
Any data and information is provided 'as is' solely for informational purposes, and is not intended for trading purposes or advice.
Past performance is not indicative of future results.