Compensation Sought by FX Traders from Brokers Drops 3% to $3.3M in Q4
- This is according to FinCom's Quarterly Complaints Digest for Q4 2022.
- The EDR body said range bound FX prices as well as winter holidays affected key metrics.
The total compensation sought by online forex brokers from all brokerages declined slightly to $3.3 million during the fourth quarter of 2022, which is down from $3.5 million in the prior quarter. Similarly, the compensation awarded to traders dropped by 23% to $60,919 during the past quarter.
On the contrary, the compensation sought from member brokers of the Financial Commission (FinCom), the independent external dispute resolution (EDR) body for the forex industry, surged by 66% during the fourth quarter of last year. These details are according to FinCom's Quarterly Complaints Digest for Q4 2022 published on Monday.
In the third quarter of 2022, total compensation sought from both member and non-member brokers of FinCom jumped by 51% to $3.5 million. in addition, the self-regulatory organization awarded more compensation to traders during the period as the amount awarded rose by 36% to $79,494.
FinCom noted that “range bound forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term and derivatives prices, as well as winter holidays” affected many of its key metrics during the last quarter.
Did Retail Traders Forgo Active Trading during Q4 2022?
In other metrics, FinCom reported declines in the total number of new complaints it received, resolved and ruled in favour of traders during the quarter. While newly filed and resolved complaints decreased by 38%, those in favour of traders came in 2% lower than the prior quarter.
“Slowdowns in filed and resolved complaints, as well as compensation sought suggest traders may be finding less opportunities on traditional markets in light of range bound price fluctuations or simply forewent trading at the end of the year,” FinCom explained in the quarterly report.
Furthermore, FinCom noted that there was a “noticeable change” in the focus of complaints during Q4 2022. While trading-related complaints only accounted for 11.7% of complaints during Q3, this category rose by 5% to 19.8% during the recent quarter “despite the general drop in new complaints for the quarter.”
Nonetheless, non-trading complaints continue to be the major topic of complaint, accounting for 41.8% of all complaints during Q4. In addition, finance-related complaints are still the second most common complaint, accounting for 35.1% and 38.4% during Q3 and Q4, respectively.
Moreover, complaints' average resolution time slowed by 33% to 6.1 days, which is down from 4.6 days during the last quarter.
“Complaints listed in the value category $1-10K and $10K+ increased their overall share of complaints 5%, highlighting the continued importance of the organization to investigate complaints with higher monetary values,” FinCom added.
FinCom, an EDR body founded in 2013, regulates international online brokers, exchanges and blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term platforms that are active in the global forex, derivatives, CFDs and cryptocurrency markets.
The total compensation sought by online forex brokers from all brokerages declined slightly to $3.3 million during the fourth quarter of 2022, which is down from $3.5 million in the prior quarter. Similarly, the compensation awarded to traders dropped by 23% to $60,919 during the past quarter.
On the contrary, the compensation sought from member brokers of the Financial Commission (FinCom), the independent external dispute resolution (EDR) body for the forex industry, surged by 66% during the fourth quarter of last year. These details are according to FinCom's Quarterly Complaints Digest for Q4 2022 published on Monday.
In the third quarter of 2022, total compensation sought from both member and non-member brokers of FinCom jumped by 51% to $3.5 million. in addition, the self-regulatory organization awarded more compensation to traders during the period as the amount awarded rose by 36% to $79,494.
FinCom noted that “range bound forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term and derivatives prices, as well as winter holidays” affected many of its key metrics during the last quarter.
Did Retail Traders Forgo Active Trading during Q4 2022?
In other metrics, FinCom reported declines in the total number of new complaints it received, resolved and ruled in favour of traders during the quarter. While newly filed and resolved complaints decreased by 38%, those in favour of traders came in 2% lower than the prior quarter.
“Slowdowns in filed and resolved complaints, as well as compensation sought suggest traders may be finding less opportunities on traditional markets in light of range bound price fluctuations or simply forewent trading at the end of the year,” FinCom explained in the quarterly report.
Furthermore, FinCom noted that there was a “noticeable change” in the focus of complaints during Q4 2022. While trading-related complaints only accounted for 11.7% of complaints during Q3, this category rose by 5% to 19.8% during the recent quarter “despite the general drop in new complaints for the quarter.”
Nonetheless, non-trading complaints continue to be the major topic of complaint, accounting for 41.8% of all complaints during Q4. In addition, finance-related complaints are still the second most common complaint, accounting for 35.1% and 38.4% during Q3 and Q4, respectively.
Moreover, complaints' average resolution time slowed by 33% to 6.1 days, which is down from 4.6 days during the last quarter.
“Complaints listed in the value category $1-10K and $10K+ increased their overall share of complaints 5%, highlighting the continued importance of the organization to investigate complaints with higher monetary values,” FinCom added.
FinCom, an EDR body founded in 2013, regulates international online brokers, exchanges and blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term platforms that are active in the global forex, derivatives, CFDs and cryptocurrency markets.