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Screenshot of a breaking news alert e-mail from Q2 2017
Two years of successive regulatory reductions in allowed leverage (now just 25:1) have taken their toll on the Japanese Forex market, knocking Japan out of first place in terms of volumes traded. The hit has been double-edged – lower leverage has reduced revenue-per-client at Forex firms operating in Japan by up to 20%, and has also caused many clients (up to 10%) to just abandon Forex trading altogether. The fact that the USDJPY pair has seen very little volatility, trading in a tight 76-78 band for the past six months, has not helped matters either.
Several leading international Forex firms have taken advantage of the turmoil in Japan, buying up troubled Japanese Forex firms:
- Market leader FXCM acquired two Japanese firms in 2011 – Foreland Forex (for $17 million) and CGI Capital ($27 million), and now stands as one of the top five firms in Japan.
- Alpari acquired CMS Japan KK.
- Leading Ireland-based firm AvaFX acquired Art Co Japan.
For more details and information on the global Forex market see the LeapRate-Dow Jones Forex Industry Report for 2011.