Since the first signs of market saturation in the West and growing global competition, FX/CFD brokers have been looking to conquer new, distant markets. Emerging economies have always been a natural destination for retail brokers for such an expansion. However, the less untapped a given market was, the more difficult it has been to succeed there.
One of the typical problems in emerging markets has always been a lack of proper regulation; or in some cases, far too restrictive laws. For the past ten years, many different brokers have tried to conquer China. This, however, never ended up with significant success for any of the firms trying to get a foothold in this market.
For this reason, Finance Magnates examined two interesting and promising destinations of this area – Thailand and Vietnam – to see if and how FX/CFD and crypto businesses can succeed there. As in the majority of South Asian countries, also in Thailand, forex trading is popular among clients, and yet, the regulatory framework leaves much to be desired. The situation is even more demanding in Vietnam. One could consider Vietnam as the place with no chances of doing any FX/CFD business. Contrary to this impression, a lot of retail brokers try to approach Vietnamese customers.
According to research by Finance Magnates Intelligence, 34 percent of brokers covered in the Finance Magnates Volume Ranking are trying to approach the Thai market with a version of their website translated into Thai. From the same research, we know that 38 percent of brokers covered in the Finance Magnates Volume ranking are trying to approach the Vietnamese market with a local language version of their websites.
What retail brokers may expect in Thailand and Vietnam?
Local traders also have their specific requirements, Kuekul Srisirivilai, from Tan Trader, reveals what he thinks is the most important thing when choosing a broker in Thailand: „A broker must prove its reliability and have positive customer feedback. These are the requirements I based my choice of the company on.”
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Finance Magnates asked about the opinion of one of the most known figures in the Vietnamese forex scene – Duong Nguyen Huy, the founder and CEO of TraderViet, the most popular website for traders. He described the local market in the following way: “The FX/ CFD market is a potential market in Vietnam. The population characteristics of Vietnam are a young population with higher incomes. They pay more attention to researching and looking for new, suitable investment channels for themselves. Although it has been in Vietnam for more than ten years, FX/ CFD is still not too popular here.”
Is it worth it?
From the perspective of brokers used to the European or Australian markets and their regulations, both Thailand and Vietnam must seem like slightly risky and exotic markets. At the same time, the majority of brokers, especially the smaller ones, must look for new growth opportunities outside of the already saturated EU/Australian markets.
Demographic and economy play an important role here. Both Thailand and Vietnam have a young population that is yearning for financial success. This creates a solid base for a bet on these markets.
To get the full article and the bigger-picture perspective on the Thailand and Vietnam, get our latest Quarterly Industry Report.