Retail Forex Trading Industry in 2021: Is It Possible to Sustain Growth?
This season has been an intriguing one for forex traders across the world, coronavirus pandemic, lockdowns and unprecedented volatility fueled trading tasks and resulted in volumes that are high with the record-breaking addition of new traders. The retail forex sector was facing a tough challenge before 2020 due to regulatory concerns across the world as companies began reporting a dip in volumes. Many brokers closed offices in different parts of the world due to regulatory issues.
In March 2020, due to a substantial outbreak of COVID 19, lockdowns limited travel, and people were bound to stay at home. Financial markets began reacting and that resulted in many trading possibilities across various assets. Due to increased volatility in the forex market, existing traders started increasing their exposure to make use of new trading possibilities as new traders entered the industry. To be a result, forex brokers registered new clients and record volumes. Now that 2020 is intending to end, the true concern arises, do you find it simple for the retail forex trading industry to retain the considerable growth it achieved during 2020? We asked industry experts for their take on the retail forex trading industry in 2021.
“One key consequence of the pandemic has been the move to working from home, both for brokers and traders alike. The COVID-19 outbreak has additionally resulted in unprecedented volatility. These have been some of the drivers for the enormous rise in trading volume seen since March, as traders had far more time on the hands of theirs on account of lockdowns and a reduced amount of travel overall, and were also looking for new interests to develop since they’d newfound moment to dedicate. And so, not just had been existing traders increasing their volumes but some firms have seen record quantities of new traders enter the business. This was surely the case for Exness about both volumes and new clients,” Moyes said.
“Initially in March when the pandemic broke out worldwide, there was an important upsurge in volatility which, together with all the newcomers, was driving volumes to unprecedented levels. Although there was the inevitable slight drop off in the months right after, volume levels had continuously increased all over the year with levels far exceeding those prior to the pandemic. For many firms, the increases might well be sustainable because of the number of new clients. Also, circumstances around the spare time of individuals and working from home have changed hardly any since earlier in the season, therefore, the same drivers for increased volumes continue to use. We’re receiving about eighty % of the March volatility volume in Exness and now running near to a fifty % increase from this time last year,” the Chief Commercial Officer at Exness added.