The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.
Foreign Exchange

Trading volumes surging despite lack of volatility

According to both EBS and FXall, the first quarter of 2006 was the busiest ever for FX trading. Talking purely about spot, EBS says daily activity in the quarter averaged $132 billion, a 2.3% increase on the same period in 2005.

The company says that its busiest day in the quarter was February 10, when more than $191 billion was traded. This figure was reached by a total of 102,000 transactions, meaning that the average deal size on EBS has fallen below $1.9 million.

Players are attributing the continuing growth in the market to the increasing use of algorithms, which is resulting in smaller ticket sizes going through. Alan Fletcher, director of FX and bullion at Oanda, says: “We saw a 40% increase in the first quarter over 2005. What’s encouraging is that there seems to be a whole new class of FX players coming into the market, which is helping to keep overall volumes growing at a time when volatility in the market is actually very low.

Fletcher adds that many sell-side players are struggling to handle volume of small-ticket trades profitably. “Some guys are complaining that the business is ‘dross’. Lots of small trades are being fired through rapidly and you have to have smart systems in place to be able to handle and make money from this type of business. We are set up to do that and capture the spread by having sophisticated risk management protocols in place.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree