US Retail Forex down Across the Board, August FCM Data Shows

The summer was a dry period for the American retail FX trading industry, as shown by the recently released monthly report by the Commodity Futures Trading Commission’s (CFTC). According to the latest data filed by US Futures Commission Merchants (FCMs) and Retail Foreign Exchange Dealers (RFEDs), firms' retail 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 funds suffered a decline in August 2015.

For the month ending August, total retail FX obligation went down by 7.4% MoM from July 2015. Moreover, each and every broker has reported a decrease in the amounts of FX funds they held over the move. This is especially worrisome for the American industry as the markets saw higher Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad Read this Term in August compared with July.

As can be seen from the chart, the worse performance was by Interactive Brokers whose retail FX funds crashed about 21% in August 2015 month-over-month. While smaller players also suffered losses above 10%, FXCM, GAIN Capital and OANDA losses remained in single digits territory.

As the whole market went down across the board, the relative strength of the companies active in the US market remained similar to previous months. FXCM maintained its leading position, followed by GAIN Capital and OANDA coming in at third place. Despite its bigger losses, even Interactive Brokers was still capable of staying above IBFX in terms of market share.