Us retail FX brokers report drop in client deposits for December

abdelaziz Fathi

The Commodity Futures Trading Commission (CFTC) has published its monthly report for December 2022, which covers data for FCMs that are registered as Retail Foreign Exchange Dealers (RFEDs) and those included as broker dealers that hold retail Forex obligations in the United States.

The US retail FX brokers saw a collective negative change in clients’ deposits month-over-month from December, though differences amongst each broker were more pronounced.

Specifically, the FX funds held at registered brokerages operating in the United States came in at $482 million in December 2022, which is 1 percent less than the $486 million reported in November.

The newest comer to the US FX industry, Trading.com Markets, continues to take a bigger chunk of the overall retail funds, but on a very limited scale. The broker racked up $701,000 in customer deposits in December, up 19 percent from just $590,000 a month earlier.

The US arm of forex brand XM provides retail foreign exchange services to US traders amid a tough regulatory environment that has squeezed other providers out of that market. Trading.com first applied for a forex broker license in the US back in January 2019. The company, however, still has a long way to go to challenge the likes of GAIN Capital and Oanda, which command nearly 70 percent of the US retail market.

Other highlights from the CFTC’s monthly report show that Interactive Brokers LLC (NASDAQ:IBKR) has racked up $24.6 million in total deposits. This was down by 4 percent from $25.8 million in the prior month.

IG US reported a slight increase of $39K to $44.55 million at the end of December 2022. After consecutive increases in its market share, Oanda also suffered a drop in retail deposits in December 2022. Specifically, the Canada-headquartered FX broker’s net balances decreased by $3.96 million, or 2 percent, to $160 million.

Meanwhile in December, GAIN Capital saw an increase of nearly $646K, or 1 percent on a monthly basis, coming in at $184.4 million.

The chart listed below outlines the full list of all FCMs that held Retail Forex Obligations in the month ending December 31, 2022. For purposes of comparison, the figures have been included against their November 2022 counterparts to illustrate disparities.

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