FXCM Trading Metrics Stabilize after Volatility Comes Back in May

The trading volumes of FXCM rebounded sharply as election results in France drove some volatility.

Online foreign exchange and CFDs brokerage FXCM has reported its trading metrics for the month of May. The company’s clients transacted a total of $213 billion during the month. The figure is higher by 21 percent when compared to April and lower by 21 percent year-on-year.

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The figures have been consistent with broad industry trends, catalyzed by the French election and political turmoil in the US and the UK. Despite increased volatility in EUR pairs, the moves across the currency markets throughout the last month were still subdued by historical standards. With the traditional summer lull for volumes coming up, brokers have been facing increased pressure.

FXCM reported average daily volumes (ADV) increasing 6 percent month-on-month to $9.3 billion in May. The figure was lower by 24 percent when compared to May last year. The number of client traders also ticked lower with the figure reaching 334,536 daily, a metric that is lower by 4 percent when compared to April and down 32 percent year-on-year.

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The number of active accounts declined to 128,242, which is lower by 1,124 when compared to April and by 5,141 year-on-year. Tradable accounts rose by 412 from the end of April, but were lower by 5,882 when compared to a year ago.

Recent trends in trading volumes are showing that the market remains heavily influenced by volatility and the multi-year lows in this regard could be forcing a consolidation in the industry. Brokers which have significant cash reserves are more flexible when it comes to meeting operational needs.

Attracting new clients in times of low volatility has historically been difficult for brokers. Aside from cryptocurrencies, few asset classes have been actively traded since the start of the year, the notable exception being pockets of volatility around major political and economic events.

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