Gain Capital October retail forex volumes rise 43%, with GFT now on board

However the increase was not as large as expected, given what we knew about GFT’s pre-merger volume metrics.

As we reported several weeks back, forex broker Gain Capital (NYSE:GCAP) closed its acquisition of rival GFT at the end of September — meaning that October would be the first full month where we see the volumes of the combined companies.

And while adding GFT to its own volumes did give Gain Capital a nice bump in reported volumes, the rise wasn’t as much as we expected — leading us to conclude that there has been some attrition of GFT customers to other platforms and to other forex brokers.

Gain Capital GCAP October volume metrics

But first, the details.

Gain Capital retail volumes came in at $186 billion for October — its best result ever — and 43% above September’s $130 billion. Institutional volumes were $291 billion, up just 4% over September.

However, as we reported at the time of the merger, GFT averaged about $130 billion in monthly trading volume in the first half of 2013, with the breakdown almost exactly 50/50 between retail and institutional volumes. Holding steady, that should have meant an expected $65 billion monthly rise in volumes in both retail and institutional volume metrics at Gain post-merger. The increases we did see — $56 billion retail and just $12 billion institutional — were a lot lower.

We believe that part of the issue here is just timing — October was a very slow month for institutional volumes, due in part to the uncertainty caused by the two-week US Government shutdown, although retail volume seem to have held steady in October at firms such as FXCM and Saxo Bank.

For the complete Gain Capital press release on October volumes click here.

For more on the global Forex industry see the LeapRate-Dow Jones Forex Industry Report.

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Gain Capital October retail forex volumes rise 43%, with GFT now on board


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