Synthetic currency pair

A synthetic currency pair is when two currencies are combined to make a new one. For example, if you put together the U.S. dollar and the Japanese Yen, it creates a "synthetic" currency pair called "USD/JPY." This currency pair is not actually traded on a market –– instead, it is created so people can use two different currencies at the same time to make buying, selling, or exchanging easier. This can be helpful when you are dealing with different countries and want to trade with each other but don't understand each other's currency.