What is the annual turnover of the forex market?

Forex trading is the highest liquid market across the world; that’s the reason traders are attracted to it day by day. And then it has conquered the world tremendously in some past decades. The average daily volume was more than 13.4% in October 2020.

Over the last decades, a 40% increase in daily forex trading volume has been observed. Daily turnover in the worldwide currency exchange market has reached $6.6 trillion, with a 40% rise in the daily triangle market over a few decades, as reported by LearnBonds.

According to semi-annual surveys, the forex market will hit a new high in April 2021. By the seven surveys, it is reported that the average daily volume (ADV) of the forex market was $5.926 trillion. It indicates an 11.1% increase in volume from the previous surveys of October 2020.

Here, we have covered the semi-annual turnover of the foreign exchange market. Let’s dive in!

  • UK forex trading turnover

In April 2021, the average daily reported that United Kingdom foreign exchange turnover touched record highs of $2,948. It showed a 14% increase on the $2,582 billion turnover record in October 2020, and in April 2020, a 22% increase relative to the $2,412 billion turnovers recorded.

  • Turnover in forex trading swaps

Turnover in FX swaps increased to $1,527 billion, a rise of 15% relative to October 2020. Since October 2020, the turnover in FX spot has increased by 14%.

Moreover, USD/EUR is the most traded currency pair in London in April 2021, with an average daily turnover of $905.8, touching all-time highs. Also, turnover in all other instruments assets has increased compared to the 2020 April survey.

Why is forex trading conquering the world day by day?

As we estimate by reading above forex turnover, forex trading is the world’s largest and most highly liquid market. Here are some reasons why forex trading has become the center of attention for most traders. So, let’s have a look.

  • Low costs

Forex trading may come with comparatively low costs in terms of brokerage and commissions. Like most of the brokers only make profits and commissions from the spread between forex currencies. Learn more about what is spread in forex. Traders should not worry about separate excessive brokerage charges.

  • High liquidity

Compared to other financial markets, forex trading is the biggest national worth of daily trading. It comes with the highest level of liquidity, which indicates even major orders of currency traders are easily made strategically without any major price deviation.

Moreover, traders don’t need to be tense about the high volatility during opening and closing hours.

  • Variety of currency pairs to trade

A trader can trade with more than 170 different currency pairs, in which 8 major currency pairs are involved. Criteria for selecting a pair can be economic developments, volatility patterns, and feasible timings.

Other reasons are the following.

  • No regulator or central exchange
  • Varying training strategies
  • Low capital requirements
  • Easily make entry and many others

Final Verdict

In a nutshell, the forex market comes with many financial leverages but fewer regulations than other markets like stocks. It makes it highly profitable but also riskier.

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