IG US sees 15% jump in retail FX deposits

abdelaziz Fathi

Retail FX deposits at US brokerages, which have been struggling to eke out a profit in a strict regulatory environment, rose slightly in July 2023 by $7.2 million, CFTC data showed.

The brokers, including FCMs that are registered as Retail Foreign Exchange Dealers (RFEDs) and those included as broker-dealers, saw a collective positive change in clients’ deposits month-over-month from June, though differences amongst each broker were more pronounced.

Specifically, the FX funds held at registered brokerages operating in the United States came in at $518 million in July 2023, which is one percent higher than the $511 million reported in June.

According to the CFTC’s dataset, Interactive Brokers LLC (NASDAQ:IBKR) reported $31.4 million in total deposits. This figure was down by $1.8 million, or 3 percent, from $33.3 million in the prior month. This decrease, however, is attributed to customers’ actions related to settling leveraged FX positions, rather than outflows Brokers. When clients pay down the debit side of their positions, their cash balances transition from retail forex obligations to securities cash. Importantly, these changes in balance are independent of trading volume and should not be misconstrued as indicative of such activity.

The newest comer to the US FX industry, Trading.com Markets, racked up $1.098 million in customer deposits in July, down 3 percent from $1.13 million a month earlier.

Other highlights from the CFTC’s monthly report show that IG US was the best performer with nearly $9.1 million in additional deposits, or 15 percent higher on a monthly basis, coming in at $68.6 million in total.

Meanwhile, GAIN Capital also reported an overall increase of $2.3 million to $199 million at the end of July 2023, or a rise by one percent month-over-month from $196 million in June.

After consecutive increases in its market share, Oanda shows lackluster performance in retail deposits in July. Specifically, the Canada-headquartered FX broker’s net balances dropped by $1.36 million, to $155 million.

Additional findings from the CFTC report indicate that Charles Schwab’s client funds were down $0.99 million, a 2% decrease compared to the previous month.

GAIN Capital held the top position in market share with 38%, followed by OANDA with 30%. IG US and Charles Schwab accounted for 13% and 12%, respectively.

The following chart provides a comprehensive list of all FCMs (Futures Commission Merchants) that held Retail Forex Obligations in the month ending July 31, 2023. To offer a clear comparison, the figures for June are included alongside to highlight any differences.

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