Where is the Forex Industry Heading?
The forex industry has seen a lot of changes in the past ten to fifteen years, mainly due to the increasing impact of the internet. Along with a number of other factors, this has seen trading volumes continue to increase because of the flexibility that trading currency now provides. This has all led to a certain degree of uncertainty regarding the future of forex trading, for both professionals and part-time traders. So where is it heading in the next few years?
Changes to Trading Platforms
Trading platforms have undergone a lot of rapid developments in the past decade. From the internet making trading a lot quicker and easier, it has also made it a lot more accessible to casual traders. The early online platforms were understandably somewhat primitive, but underwent a lot of improvements to get where they are today.
The increasing use of smartphones and tablets have seen many competing trading apps developed. Oanda offers a trading app that can execute trades in 0.057 seconds, meaning you can exchange currency almost immediately on the go. There are plenty of apps available, so you can find one that suits your individual needs best.
Threats to Traders
While a lot of the changes have been good news for traders, they have also introduced a large threat to professional forex brokers. A lot like stock floor traders, forex traders are a dying breed. In 2001 electronic trading made up just 20% of currency transactions, but in 2013 it was 66%, predicted to reach 76% by 2018.
Individuals have less need to use the services of a professional forex trader, as a lot of the required information can be found online and platforms easily downloaded to do it themselves. Machines and computerised trading is the main threat to workers in the forex industry.
Along with the number of forex trades done electronically set to increase even further, there is also a growing number of forex competitors. In order for each one to stay ahead of the competition, more and more is being invested in technology to develop apps and platforms.
This is a costly endeavour, and one that not all small forex companies can afford, so the number could of forex companies could soon fall. However, for individual traders the future looks bright, with higher volumes of currency set to be traded and the developing technology making it even easier. There will still be plenty of opportunities to profit from trading forex, but forging a career with a brokerage may prove a bit more difficult.