Despite a second consecutive month of decline, retail investor Forex deposits in the US continue to maintain long-term highs. A significant drop was observed only in the case of Interactive Brokers, whose "total forex retail obligation" in May fell by 24%.

Forex Deposits in the US Still Close to $550 Million

According to the latest data from the Commodity Futures Trading Commission (CFTC ) for May 2024, the total value of FX deposits in the US amounted to $547,720,090, slipping by 0.01% from the $547,759,474 reported a month earlier.

Although this marks the second consecutive month of decline from the recent record level of $549 million in March, the values, as shown in the chart below, remain at multi-month highs.

Gain Capital continues to lead in terms of deposit size, with its total forex retail obligation reaching nearly $208 million, growing by 2% or $3.6 million. OANDA ranked second, with an increase of 2.4% or nominally $4.4 million.

The strongest percentage growth was recorded by Trading.com, adding 9.5%. However, its total FX deposits are nominally the most modest, growing by just under $200,000 to $2.2 million.

On the other hand, Interactive Brokers reported a very sharp decline, rarely seen in data reported to the CFTC.

FX Deposits at Interactive Brokers Sharply Down

The latest data released by the US regulator shows that Interactive Brokers' deposits shrank by 23.5%, falling by over $8 million from $35.8 million reported in April to $27.4 million reported in May.

The total forex retail obligation for Interactive Brokers had been gradually declining since September of last year and showed a stronger rebound in April. However, it appears that in May, it returned to continuing its previous trend.

Regulatory Financial Reporting for RFEDs and FCMs

The CFTC mandates that Retail Foreign Exchange Dealers (RFEDs) and Futures Commission Merchants (FCMs) provide monthly reports detailing their financial status. These reports are required to cover critical financial indicators, including adjusted net capital, client assets, and the total amount of retail forex commitments. Retail forex commitments are defined as the total assets held on behalf of clients by FCMs or RFEDs, adjusted for any gains or losses that may have occurred.

The requirement applies to all 62 registered RFEDs and FCMs, which includes prominent firms such as Charles Schwab, Gain Capital, IG, Interactive Brokers, OANDA, and Trading.com. These firms are required to make their financial commitments publicly available.

A recent analysis by Finance Magnates highlighted that FCMs are increasingly investing in advanced front-end technologies. This investment aims to improve operational efficiencies and strengthen their competitive position in the highly competitive derivatives market.