On Friday I got this short message from US Forex broker GFT:
“Wednesday was one of the most volatile trading days in the FX market for USD/JPY in years. Through it all GFT provided traders with consistent spreads of 3 pips or less, executed all market orders requested, and executed all stops and limits which were due to be filled.”
I’m not supporting nor going to enter into discussing who is the most handsome broker in town, who is the best or the winning horse, I think that the consolidation of the industry has brought along a sophistication of the firms operating in it as they get better and better.
I just want to say that JPY is the third currency more transacted with a daily market turnover of 19 percent right after the USD (84%) and the EUR (29%) upon the latest “Report on Global Foreign Exchange Market Activity” in 2010 released by the Bank of International Settlements showed.
Specifically, the USDJPY is the second pair more transacted with a daily turnover over $500 billions.
With such huge liquidity is quite understandable that the operation costs must be low, but to maintain them tight in a moment of great volatility is without a doubt a demonstration of technology capacity and good relationships with liquidity providers in the interbank market.