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Forex giant Forex Capital Markets (NASDAQ:FXCM) reported on Wednesday its US retail business, which it is in the process of selling to peer Gain Capital [NYSE:GCAP], accounted to 19.7% of its trading volume for January 2017. The broker reported a total retail trading volume of $315 billion for last month, of which $62 billion was generated from operations in the US and the remaining $253 billion came from outside the US.
This is the first time the broker publishes segmented statistics. Last week the US regulators forced it out of the market after they found it was performing fraudulent activities.
Both the US and non-US businesses posted a significant increase in last month’s trading volume of 35% and 18%, respectively.
In January, FXCM’s clients operated 178,772 active accounts in total and those in the US numbered 46,764. Daily trades per customer averaged 113,684 in the US and 488,917 outside the US. For more details refer to the table below:
Last week, FXCM also published financial data about its retail operations for the nine months, ended 30 September, 2016, which showed that the US market accounted for 19% of the brokerage’s revenue.
However, since FXCM’s US business generated a net loss of $13.9 million, while the group had a consolidated net income of $126 million, it became clear that exiting the market could actually turn out to be beneficial for the broker as it would improve its overall financial performance.
Following the regulatory ban, FXCM announced it has entered into an agreement with Gain Capital to sell its US clients base. It will receive either $250 or $500 for each transferred client, depending on the trading activity.
Forex Capital Markets LLC, FXCM’s US unit was banned by the US National Futures Association (NFA) and agreed to withdraw from registration with the US CFTC and never to seek to register with it. It was charged with taking positions against customers, concealing that a key market maker was tightly related to the broker, and misrepresenting its “No Dealing Desk” platform as providing no conflict of interest with customers.
On Monday, FXCM also announced its US unit was fined by the CFTC $650,000 in relation to charges for undercapitalization around the Swiss Franc (CHF) related crisis from January 2015. The broker said at the time this brought to a close all material US regulatory matters affecting its US unit.