The third
month of dollar declines and testing 18-month lows has clearly discouraged US
investors from seeking investment opportunities in financial markets.
According to the latest September 2024 data, retail trader deposits in the
country fell for the third consecutive month, losing over 5% from this year’s
highs.
FX Deposits in the US Hit
June Lows
According
to the latest report from the Commodity Futures Trading Commission (CFTC) for
September 2024, the total value of FX deposits in the US amounted to $526.8
million, falling almost 1% from
$530 million reported a month earlier. These are currently the lowest
values in three months, though still higher than last
year’s result of slightly over $515 million.
Although the dollar is performing well now, September told a different story. Just two months ago, its index (DXY) was testing over year-long lows, which clearly affected investor activity.
The decline
in investor activity is also confirmed by volume data from the US exchange
Cboe, where spot volumes fell below $1 trillion, reaching
$981 billion. Although September had one less trading day than August, the
average daily volume (ADV) also decreased from nearly $50 billion to $46.7
billion.
Growth Only at Charles
Schwab and Gain Capital
Similar to
the previous month, only two of the six reporting entities showed growth.
Charles Schwab recorded a modest increase in deposits for the second time,
growing by 2.5% from $63.7 million to $65.3 million.
In
September 2024, Gain Capital also achieved this feat, noting a modest jump of
0.8% from $202.9 million to $204.6 million.
Interactive
Brokers experienced the strongest declines both in nominal and percentage
terms. The broker’s deposits shrank by $5.1 million or over 15%.
Financial Reporting
Obligations for US Forex Brokers
The
Commodity Futures Trading Commission (CFTC) oversees the financial transparency
of Forex brokers in the United States. Specifically, it requires Retail Foreign
Exchange Dealers (RFEDs) and Futures Commission Merchants (FCMs) to submit
comprehensive financial reports on a monthly basis.
These
financial reports must detail critical metrics, including: adjusted net capital,
client assets and retail forex obligations.
Retail
forex obligations reflect the total assets that FCMs or RFEDs hold on behalf of
their clients, factoring in any profits or losses incurred. This requirement
applies to all 62 registered RFEDs and FCMs in the U.S., covering firms like
Charles Schwab, Gain Capital, IG, Interactive Brokers, OANDA, and Trading.com.
By
mandating these disclosures, the CFTC aims to enhance industry transparency and
allow for better public insight into the financial health of these firms.
Recently,
FCMs have been observed making significant
investments in advanced front-end technologies. These upgrades are intended
to boost operational efficiency and help these firms stay competitive within
the evolving derivatives market.
The third
month of dollar declines and testing 18-month lows has clearly discouraged US
investors from seeking investment opportunities in financial markets.
According to the latest September 2024 data, retail trader deposits in the
country fell for the third consecutive month, losing over 5% from this year’s
highs.
FX Deposits in the US Hit
June Lows
According
to the latest report from the Commodity Futures Trading Commission (CFTC) for
September 2024, the total value of FX deposits in the US amounted to $526.8
million, falling almost 1% from
$530 million reported a month earlier. These are currently the lowest
values in three months, though still higher than last
year’s result of slightly over $515 million.
Although the dollar is performing well now, September told a different story. Just two months ago, its index (DXY) was testing over year-long lows, which clearly affected investor activity.
The decline
in investor activity is also confirmed by volume data from the US exchange
Cboe, where spot volumes fell below $1 trillion, reaching
$981 billion. Although September had one less trading day than August, the
average daily volume (ADV) also decreased from nearly $50 billion to $46.7
billion.
Growth Only at Charles
Schwab and Gain Capital
Similar to
the previous month, only two of the six reporting entities showed growth.
Charles Schwab recorded a modest increase in deposits for the second time,
growing by 2.5% from $63.7 million to $65.3 million.
In
September 2024, Gain Capital also achieved this feat, noting a modest jump of
0.8% from $202.9 million to $204.6 million.
Interactive
Brokers experienced the strongest declines both in nominal and percentage
terms. The broker’s deposits shrank by $5.1 million or over 15%.
Financial Reporting
Obligations for US Forex Brokers
The
Commodity Futures Trading Commission (CFTC) oversees the financial transparency
of Forex brokers in the United States. Specifically, it requires Retail Foreign
Exchange Dealers (RFEDs) and Futures Commission Merchants (FCMs) to submit
comprehensive financial reports on a monthly basis.
These
financial reports must detail critical metrics, including: adjusted net capital,
client assets and retail forex obligations.
Retail
forex obligations reflect the total assets that FCMs or RFEDs hold on behalf of
their clients, factoring in any profits or losses incurred. This requirement
applies to all 62 registered RFEDs and FCMs in the U.S., covering firms like
Charles Schwab, Gain Capital, IG, Interactive Brokers, OANDA, and Trading.com.
By
mandating these disclosures, the CFTC aims to enhance industry transparency and
allow for better public insight into the financial health of these firms.
Recently,
FCMs have been observed making significant
investments in advanced front-end technologies. These upgrades are intended
to boost operational efficiency and help these firms stay competitive within
the evolving derivatives market.
This post is originally published on FINANCEMAGNATES.
