Euromoney collected data for its 2005 FX survey by polling named individuals at industrial and commercial corporations, financial institutions, institutional investors and state agencies.
We received 4,492 valid replies, an increase of 28.3% over last year’s figure of 3,501 replies received. A total of 4,676 questionnaires were submitted between Friday, January 14th and Friday, March 25th 2005.
184 of these, or 3.9 % of the total, were deleted for the following reasons, listed in order of frequency:
1. FX service providers were voting for themselves
2. Euromoney did not receive confirmation from the respondent of their identity.
3. Voters submitted more than one ballot.
Questionnaires were sent out both electronically and by fax in English, French, German, Italian, Spanish, Turkish, Korean, Japanese and Mandarin Chinese,. The survey was also available in these languages for download on the Euromoney magazine website.
Voter Breakdown by region (2004 figures in brackets): Europe excluding UK 27.85%(34.16%), North America 19.81%(18.59%), Asia and Australia 30.25% (28.08%), UK 12% (11.94%), Africa, Middle East and Latin America 10.36% (7.23%).
Turnover Breakdown by region
Europe excluding UK 27.13% (29.38%), North America 36.05% (30.06%), Asia and Australasia 13.65%(12.12%), UK 21.09% (26.35%), Rest of World 2.08% (2.09%)
Voter Breakdown by Institutional type: (2004 figures in brackets): non-financial corporates 56.19% (55.18%), hedge funds 6.88%(6.86%), non-market-making banks 20.61% (17.08%), insurance company asset management 2.63% (3.14%), pension funds 1.74% (2.06%), independent investment advisors/CTAs 3.29%(3.54%), other asset managers/mutual funds 6.23%(9.0%), brokerage affiliates 2.56% (2.34%), state agencies 0.76% (0.57%) , other 2.07% (2.91%)
Turnover Breakdown by Institutional type
Non-financial corporates 14%(20.94%), Non-market-making banks 25.2(27%), Central banks 0.3%(0.27%), State Agencies 1.2%(0.96%), Multilateral agencies 0.1%(0.67%), Hedge Funds 24%(21.53%), Pension and Insurance Company Asset Management divisions 6.1%(5.81%), Other Asset Managers 11%(15.46%), Brokerage Affiliates 6.6% (4.1%), Independent Investment Advisors/CTAs 10.5%(4.8%), Other 1.2% (1.02%)
Respondents were asked to choose from the above categories that/those which best described their business activities. A number of people chose more than one category, which is why breakdowns by votes cast may add up to more than 100%!
Overall ranking by market share: based on the total volume of FX business placed annually with each bank. To obtain this figure, we asked respondents to estimate the proportion of their total annual FX dealings placed with their 10 top counterparties.
Total business placed with each service provider across all questionnaires received was then divided by total business on all questionnaires – 40.05trn US dollars (up 39.5% on the 2004 sample size of 24.24trn US dollars) – to arrive at a market share figure.
Other results were compiled on a scale of 4:3:2 for first, second and third place respectively. They are NOT weighted according to volume.
ALL respondents have been contacted by email or phone to confirm their identities and to obtain consistently defined turnover figures. Euromoney would like to thank all voters for their patience and tolerance in sparing approximately ten minutes, having filled out a long survey, to answer the following questions:
1) Can you confirm your name and confirm your job title within [COMPANY]?
2) Have you received any offers of any special incentives from any service provider or counterparty in connection with the survey? (we stressed that this was confidential)
3) We have an overall Turnover figure of [X million dollars] listed for you, is that correct?:
Is that in US Dollars?
Are any Swaps in that figure single-counted (one leg only)?
Any rollover of FX transactions (futures, for example)? If so: If you were to roll over any hedging instruments for the underlying transactions only one time (in a year), about how much would that change the figure you’ve given?
Does any amount of that figure come from market-making activities that your company does? If so, about how much? We have been especially careful in assessing turnover figures given by banks. If any bank was a market-maker in even one currency, all turnover thereby generated was deleted by Euromoney from any turnover figures given. Where clarification on this point was not received from the bank in question, we deleted the entire turnover figure.
If respondents did not give exact numbers, we sought approximate numbers or percents. In the case of ranges, we took the bottom of the turnover range indicated.
For voters who worked for / were affiliated with banks, e.g., brokerage affiliates, joint ventures or subsidiaries, we asked:
1) Do you have complete discretionary powers over where you place your FX business? All non-discretionary turnover was deleted..
2) How much of your business do you have to place with [whatever bank they work for / are affiliated with?
Voters for FX Connect were asked:
Do you use FX Connect strictly as a multibank platform, or do you use it mostly to do business with State Street Bank? State Street owns FX Connect and uses it partly as its own trading platform, but people do use it to do business with all banks, i.e., as a multibank platform.
