It’s been a tumultuous year for the industry with the first eight months of 2014 bringing a number of challenges for clients and providers of forex and CFD trading services. The lack of volatility across multiple asset classes has been blamed for a protracted period of consolidation for a number of businesses.
Singapore, as one of the richest countries in the world, has been no exception to this trend as a massive survey by Australian research organization Investment Trends shows. While the survey was conducted before increased FX volatility came to the marketplace (or during the beginning), the results are showing the diminishing appetite of Singaporean traders towards FX in recent years.
According to the survey, which was reviewed by Forex Magnates reporters, 20,200 investors have traded FX and/or CFDs in the region throughout the 12 months up to September 2014. While this represented an annual decline of eight percent, when broken down, 17,000 (flat year-on-year) of those traded CFDs while 13,000 traded forex (down 13% year-on-year).
While the CFDs markets in the country have finally stabilized after years of steady declines, peaking out at 23,000 traders in 2011, the same cannot be said about forex trading. The trend there is a continuing decline from 29,000 in 2010, which was the first year of the survey.
OANDA and Phillip Futures Leading Forex and CFD Brokers Market Share Charts
According to the survey of 10,000 respondents, Phillip Futures continues to be the most popular choice for CFD traders at just below 25%, with IG Markets in the second spot (around 17%) and City Index and CMC Markets very close in third and fourth (just below 14% each).
Recently acquired by GAIN Capital, City Index has been at the forefront of growing fast and steady in this business throughout the past four years, while a relative newcomer to the CFD market, OANDA, has started from zero in 2012 and has achieved five percent market share in the CFDs trading arena.
On the forex trading front, the leadership position of IG Markets last year has been challenged heavily by OANDA which has grown its market share by six percent over the past year and now provides its foreign exchange trading services to just under 18% of traders in Singapore.
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While IG consolidated its position when compared to last year, holding just above 15% of the market, CMC Markets has bettered its position this year, overtaking Phillip Futures for the third spot.
OANDA, CMC Markets and IG are leading the way in customer satisfaction rates with customers giving them favorable ratings, with OANDA at 92%, while CMC Markets and IG get the approval of 86% of their clients.
Spectacular Mobile Trading Statistics in Singapore
Singapore remains an innovation hub and its population is quite keen to participate in accelerating technology adoption trends. According to the data gathered by Investment Trends, 88% of current traders are using a mobile device in relation to their forex or CFDs trading activities. This is six percent higher than last year and 24% higher than in 2012.
Curiously, while Android devices have overtaken iOS in the country for the first time since this statistic has been gathered, it could be a short term development only, as the sales rate of the sixth generation of Apple’s iPhone has propelled Apple’s stock to all time highs.
Traders from Singapore are leading the way in global charts representing mobile device usage for trading leveraged financial products, with the US and the UK in second and third spots.
Singapore remains a challenging marketplace. The tough regulatory framework in the country supervised by the Monetary Authority of Singapore has been demanding on brokers who decide to get regulated in the country.
However, with its solid financial center reputation in the region, it can serve as a regional hub for brokers targeting the lucrative Far East market. For further details about the business environment in Singapore, refer to the Forex Magnates Quarterly Industry Report for the third quarter of 2014, which features a country report on Singapore.