Japan’s OTC forex, binary option markets continue to perform poorly in Oct 2016

Japan’s OTC forex, binary option markets continue to perform poorly in Oct 2016

Japan’s forex and binary options markets continue to perform very poorly in terms of trading volume. The year started strong, but since then both markets have been shrinking significantly.

The country saw the combined forex trading volume of brokers that offer over-the-counter (OTC) forex services going down by 11% on the month to JPY 313.7 trillion in October 2016, according to the data published on Tuesday by the Financial Futures Association of Japan (FFAJ). The figure is just a tiny bit higher than that reported in August when volume hit the lowest so far in 2016. Compared to a year earlier, October OTC forex trading volume posted a drop of 16.9%.

Japan’s on-exchange forex trading volumes, however, posted a monthly increase of 5.7% to JPY 3.4 trillion last month, or up 3.1% year-on-year. Although the figure represents an increase, it is still very low compared to the beginning of the year.

The binary options market in Japan also performed very poorly last month. The combined trading volume from binaries stood at JPY 32.82 billion in October, the lowest since the beginning of the year. In comparison, in January the trading volume exceeded JPY 62 billion, which is close to double last month’s levels. On an annual basis, the volume dropped 28.6%.

The number of active binary options traders has also bee on the decline. There were 10,980 active traders at the end of October, compared to 13,703 in January.

Forex

Binary Options

Trading volume

Number of brokers

Trading volume

Accounts

Number of brokers

Over-The-Counter

On-Exchange

Existing

Active

Jan

532.32 trl

4.76 trl

53

62.06 bn

337,932

13,703

8

Feb

593.97 trl

4.85 trl

53

51.65 bn

339,997

13,656

8

Mar

439.89 trl

3.72trl

53

40.35 bn

341,946

12,786

8

Apr

416.41 trl

3.17trl

52

36.48 bn

343,455

12,225

8

May

365.99 trl

3.14trl

52

30.40 bn

344,396

11,880

7

June

429.31 trl

4.73trl

52

41.04 bn

346,292

12,676

7

July

454.35 trl

3.40trl

52

44.59 bn

348,508

11,873

7

Aug

313.53 trl

2.52trl

53

35.15 bn

350,123

11,194

7

Sept

352.46 trl

3.18 trl

53

37.84 bn

352,151

11,905

7

Oct

313.68 trl

3.36 trl

53

32.82 bn

355,023

10,980

7

In October, the volumes of trading in the USD/JPY, the most traded currency pair in Japan, also dropped significantly from the previous month by 19.7% to JPY 218.7 trillion from forex operations and by 21.2% to JPY 14 billion from binary options on the pair.

In line with the overall trend for Japan,  Monex Group and GMO Click, two of the leading brokers in the country, both reported worsened trading metrics for last month.


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