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US retail forex market continues to shrink after FXCM’s exit – survey

Oct 26 2017
By
Jonathan Smith

The US retail forex market, one of the largest in the world in volume, continues to shrink, shows the latest survey of the Investment Trends consultancy, conducted among 8000 US traders.


According to the results, the number of retail traders as of August 2017 was around 85 000, or at least this is how many placed at least one trade in the preceding 12 months. Compared to a year earlier, this is 20% less. This, according to Irene Guiamatsia, Research Director at Investment Trends, and can be attributed to the recent exit of the once leader FXCM and Interactive Brokers, which was another major player on the US retail forex market.


“Aside from the strong run in equities, recent regulatory decisions caused the exit of Interactive Brokers and former market leader FXCM”, she said.


Despite the drop in the number of active retail traders, there were plenty of new “recruits”, with around 25 000 people starting to trade in forex on margin. According to data from previous years, the figures in previous years were similar. The Investment Trends survey found that the main driver behind those figures were college coursework and education programs.


The poll also showed that the majority of traders (82%) used a mobile device as part of their trading, with the use of tablets declining, in favor of smartphones.


We remind you that this February the US subsidiary of FXCM was fined  $7 million by the CFTC and was banned from doing business in the country over misleading customers and regulators. Gain Capital - FXCM’s main rival at the US retail forex market and its brand Forex.com, acquired FXCM’s US clients and took the leading position.


Last year Interactive Brokers, a multiasset US brokerage with long history, folded its retail forex business in the US and said only clients with accounts of over $10 million, could engage in margin forex trading.


Currently the leader at the US retail forex market is Gain Capital, with Oanda and TD Ameritrade keeping it company as retail forex brokers.

 

 

TAGS: us  fxcm  gain capital  interactive brokers 
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