GAIN Capital December Retail and Institutional Volumes up YoY, Down nearly 10% MoM

Photo: Steven Hatzakis

GCAP Operator of the brand under the online trading broker Forex.com name, and institutional Forex offering under Gain GTX, through its group structure under GAIN Capital Holdings, Inc. (NYSE: GCAP), has reported December 2013 trading volumes for its global business operations, showing significant Year-over-Year (YoY) increases, despite tapering from November’s reported figures by nearly 10% month-over-month (MoM).

The total number of funded account remained flat MoM, but up 56.4% YoY and reported as 133,056 funded accounts, while the number of active account declined by 3.7% to 98,696 likely due to the December-end holiday when FX volumes tapered globally.

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December Doldrums Hamper Volumes Over November, Not Year-over-Year

Retail Over The Counter (OTC) trading volumes were reported at $153.5 billion and represented a decrease of 8.8% MoM, down from $168.3 billion in November 2013. During December, average daily volume (ADV) for retail OTC trading was $7.3 billion, also down 8.8% from November 2013, and also represented a 64% increase YoY.

Institutional trading volumes totaled $384.4 billion, down 10.3% over November (MoM) yet up almost 100% at 97.7% YoY. The Institutional segment has gained considerable traction as the weighting of the brokers volumes in its business lines has shifted, and reflected in its November reported metrics. Volumes related to the firms futures business, through its Open E-Cry (OEC) business line, had also tapered off in December when comparing to November’s reported totals.

Combined FX volumes from both Institutional and Retail segments reached $537.9 billion or over a half-a-trillion dollars in notional amounts (nominal values of currency traded converted into US dollar terms). The announcement follows a recent change in Gain’s Board of Directors, after Mark Galant had stepped down, as reported by Forex Magnates in mid-December.

A copy of the highlights are excerpted below from the official press release:

Retail metrics

Retail OTC trading volume[1] of $153.5 billion, a decrease of 8.8% from November 2013, and an increase of 64.0% from December 2012.

Average daily retail OTC trading volume of $7.3 billion, a decrease of 8.8% from November 2013 and an increase of 64.0% from December 2012.

Active retail OTC accounts[2] of 98,696, a decrease of 3.7% from November 2013, and an increase of 63.9% from December 2012.

Futures Daily Average Revenue Trades[3] (DARTs) of 14,183, a decrease of 5.8% from November 2013, and an increase of 18.5% from December 2012.

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Total funded accounts[4] of 133,056, virtually unchanged from November 2013 and an increase of 56.4% from December 2012

Institutional metrics

Total institutional trading volume[5] of $384.4 billion, a decrease of 10.3% from November 2013, and an increase of 97.7% from December 2012.

Average daily institutional volume of $18.3 billion, a decrease of 10.3% from November 2013 and an increase of 97.7% from December 2012.

Footnotes:

[1] U.S. dollar equivalent of notional amounts traded

[2] Retail OTC accounts that executed a transaction during the month

[3] Average daily trades transacted by OEC customers

[4] Retail accounts that maintained a cash balance

[5] U.S. dollar equivalent of notional amounts traded

In its latest outlook for Q1 2014, GAIN’s Forex.com division had published their Markets Outlook Report, on December 18th, which noted the expectations of an improved economy for the United States during the first quarter of 2014. Research Director of Forex.com Kathleen Brooks said in the report, “As we move into 2014, we expect a medium-term US dollar recovery, especially against the yen. Fears about a Eurozone break up may recede further into the distance helping to boost the EUR, particularly in the first quarter. Stocks and commodities may not give tapering a warm welcome, and we expect volatility in risky asset classes to rise in the first half of 2014.”