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Forex is short for foreign exchange, but the actual asset class we are referring to is currencies.
Foreign exchange is the act of changing one country’s currency into another country’s currency for a variety of reasons, usually for tourism or commerce.
Due to the fact that business is global there is a need to transact with most other countries in their own particular currency. After the accord at Bretton Woods in 1971, when currencies were allowed to float freely against one another, the values of individual currencies have varied, which has given rise to the need for foreign exchange services.
This service has been taken up by the commercial and investment banks on behalf of their clients, but has simultaneously provided a speculative environment for trading one currency against another using the internet. (If you want to start trading forex, check out the link above).