Online FX Trading Reaches New Watermark
A quarter of the world’s corporate and financial institutions are trading foreign exchange products online, according to recent research conducted by Greenwich Associates. Electronic FX users cite faster trade execution and fewer trade errors as principle reasons for embracing the practice. Yet more than half of FX market participants do not trade electronically now and have no plans to do so. The main drawback to online forex trading, according to those who do not utilize it, is the loss of personal contact. The research also revealed different attitudes to online trading between corporations and financial institutions. One third of financial institutions are dealing online, trading nearly $2.9 trillion annually. By contrast, 22 per cent of corporate institutions trade online, executing a total of around $770 billion in eFX deals annually. Online FX trading is most prevalent in the United States, where four out of every ten institutions are trading some of their foreign exchange volume electronically, although strong growth has also been reported in continental Europe and Australia/New Zealand.