Hotspot FX Volumes Modestly Rebound with 20.4% MoM Jump in August 2015

The last year has seen volatile volumes for Electronic Communications Network (ECN) Electronic Communications Network (ECN) Electronic Communications Network or ECNs are execution venues which are providing the infrastructure for matching buyers with sellers. Electronic trading is traditionally used in OTC products and outside of exchanges. An ECN normally functions as an electronic system that disseminates orders entered by market makers to third parties. In doing so, an ECN permits the orders to be executed against in whole or in part. The most common products that are traded on ECNs are stocks and currencies, maki Electronic Communications Network or ECNs are execution venues which are providing the infrastructure for matching buyers with sellers. Electronic trading is traditionally used in OTC products and outside of exchanges. An ECN normally functions as an electronic system that disseminates orders entered by market makers to third parties. In doing so, an ECN permits the orders to be executed against in whole or in part. The most common products that are traded on ECNs are stocks and currencies, maki Read this Term) Hotspot FX. Indeed, after experiencing three consecutive quarters of solid FX volume results between Q3 2014 to Q1 2015, activity at Hotspot FX has been on the decline. The company recorded four consecutive months of declining volumes to July 2015, with average daily volumes (ADV) for the month of July 8.6% lower than June.

However, the firm recorded a modest rebound for the month of August 2015, in which the company registered a 20.4% MoM jump in Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term volumes, which came in at $595.25 billion. ADV was recorded at $28.3 billion, an 18.5% MoM increase from June 2015.

However, volumes remain down on an annual basis, with total volume for the month of August 2014 almost 2% higher, at $606.9 billion, than the volume in August 2015.

The exchange operator, BATS Global Markets, acquired Hotspot FX in March, in a trend which has seen an increasing number of global exchanges vying to enter the lucrative forex market. Indeed, just last week, Nasdaq announced that it plans to launch a new forex trading platform due in 2016.

Commenting on the difficult trading period over the last few months, representatives from BATS told Finance Magnates that they were not concerned about the long-term viability of their investment in Hotspot FX, noting that the drop in volume has simply been a consequence of market fluctuations.

Indeed, the modest increase in trading volume in August will surely be encouraging.