FX traders to grow

The number of people who stopped trading foreign exchange (FX) was matched by those who started or resume trading, the first time in four years, according to Investment Trends.

Investment Trends' latest FX report, conducted during October and November 2015, found traders liked volatility and the instability in the global financial markets over 2015 provided a welcome boost to leveraged trading globally.

It found the number of active Australian FX traders was steady at 49,000, after a few years of contraction.

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Investment Trends senior analyst, Irene Guiamatsia, said "the industry has the opportunity to grow significantly during 2016, underpinned by the strong growth of the pool of next wave traders over the last 12 months".

The report also found the number of people intending to place their first FX trade in the next 12 months climbed by 60 per cent, compared to the previous year.

The fairly consistent historical conversion rates mean an estimated 17,000 investors are expected to begin trading FX in 2016.

FX traders were also found to be more likely to shop around for the best over thanks to volatility levels and the overall picking up of trading activity.

"In the 12 months to November 2015, an estimated 10,000 FX traders left a provider and continued trading elsewhere. This represents 21 per cent of the Australian FX market (up from 19 per cent in 2014)," the report said.

"Increased trading activity and a more seasoned and demanding client base are fuelling the switching activity," Guiamatsia said.

"The clear opportunity for all players is that nearly one in two of those looking to move to a new provider this year do not know who to go with next.

"These trends also mean providers need to deliver first class service and have strong retention strategies in place to avoid losing clients."

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