Japanese Brokers are taking steps to remain competitive

by Oz Golan, Tradency.

One month after applying the new 1:50 leverage rule, Japanese FX Brokers are beginning to take action in order to maintain their current trading volumes.

"TOKYO (Nikkei)-- Brokerages that handle foreign exchange margin trades are lowering commissions in order to attract customers as stricter leverage restrictions fuel concerns about a shrinking market. Online brokerage kabu.com Securities Co. will launch a 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 margin trading service via the OSE starting Sept. 17. It will charge 105 yen per 10,000-currency-unit contract instead of the 150-200 yen charged by its peers. Okasan Online Securities Co. will waive fees for trades on the TFX's Click 365 market all September. Since June, the brokerage has cut its commission to an industry-low 52-73 yen."

This indicates a growing pressure on Japanese Brokers to try and keep Forex Trading Forex Trading Forex trading is the buying and selling of foreign currencies with the aim of generating a profit. The value of currencies, especially floating currencies, fluctuate to varying degrees. This constant volatility of exchange rates opens the door for speculators to invest in a certain currency against another. The Forex market is the world’s biggest and most liquid market, with over $5 billion turnover every single day, with the market being open 24 hours a day, 5 days a week.It goes without saying Forex trading is the buying and selling of foreign currencies with the aim of generating a profit. The value of currencies, especially floating currencies, fluctuate to varying degrees. This constant volatility of exchange rates opens the door for speculators to invest in a certain currency against another. The Forex market is the world’s biggest and most liquid market, with over $5 billion turnover every single day, with the market being open 24 hours a day, 5 days a week.It goes without saying Read this Term an attractive investment by lowering the client costs for trading. It is only one move among many that the Japanese Brokers are going to take in order to find ways to maintain their current revenues. I assume we are going to see more diversification of products both within and outside the FX market.

When 1:25 leverage is on the horizon and high leverage is no longer the main incentive for trading Forex, stock trading is a suitable alternative for the retail traders. Japanese Brokers are starting therefore to offer a one-stop-shop for the trader by also offering Stock trading. " TOKYO (Nikkei) - brokerages specializing in OTC trades have begun offering bourse-based trades as well, intensifying the competition."

Following the new CFTC 1:50 leverage rule, it's possible that US Brokers will also consider offering more FX products and other alternative products in the markets , in order to act as a one-stop-shop like MB Trading does already by providing Traders with multiple types of trading options. Since CFDs is illegal in the USA, stock and futures trading is becoming more and more attractive as an offer to traders.