Exclusive: Q3 2013 US Retail Forex Broker Profitability Report, IB #1

Forex Magnates is once again publishing US retail forex account profitability and active users. Overall, among reporting brokers, active account

With another quarter in the books, Forex Magnates is once again publishing US retail forex account profitability and active users. Despite a drop in currency volatility during the quarter, both profitability and active account numbers declined. Overall, among reporting brokers, active account totaled 96,390, with weighted profitability at 34.2%, 1.2% below Q2 numbers.

(Figures exclude data from CitiFX which will be updated when available. In addition, according to FXCM, only Alpari accounts which were transferred to them as well as made a trade during the two day period between Alpari’s transfer to FXCM and the end of the quarter were added into the broker’s calculation)

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The drop in retail accounts follows two quarters where brokers showed customer growth. After an active beginning of 2013 that was highlighted by record retail forex volumes and increased volatility, the current data represents that US brokers were unable to capitalize on the increased exposure to the asset class.

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In terms of individual brokers, Interactive Brokers (IB) once again took the top spot among profitable clients, with 44% of its customers gaining. For the first time since the collection of these reports, IB also led all brokers in active clients, showing 7.3% growth. The numbers contrasted the entire US retail forex industry where brokers all reported customer contraction. Among other brokers, OANDA has been in the spotlight, this due to changing its pricing to a dynamic spread model. There has been conflicting opinion about the spreads’ changes, with client profitability holding steady this quarter, but 5% below Q4 2012’s figures.

Q3 2013 US Retail Forex Broker Profitability Report
Q3 2013 US Retail Forex Broker Profitability Report

Also worth noting is GAIN Capital, where active US accounts have fallen for the second consecutive quarter after increasing in Q1 2013, upon taking over GFT’s US client base. Lastly, ILQ showed a small drop in active account numbers.  Due to a change in how accounts are being reported, Q2 totals were restated to 1,146 versus figures reported in the Q2 report. ILQ COO, Mark Krier, also reported to Forex Magnates that there has been a rotation of US-based accounts to the broker’s new Australian-based entity as he stated, “ILQ Australia now being several quarters into its launch, we’re starting to see a shift with business moving from ILQ US to ILQ Australia.”

Previous Reports: Q2 2013, Q1 2013, Q4 2012, Q3 2012, Q2 2012, Q1 2012

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