The Forex market is one of the most fascinating and most lucrative financial markets in the world. It operates all round the clock and is accessible to anyone having access to the internet. It’s an ever-growing market with millions of traders looking for opportunities to maximize their profits.
The latest study from the FCA gives many figures on the trading performance of Forex and CFD traders. The figures are based on a 5-year period on nearly 15,000 traders or around 50% of active Forex and CFD traders.
Within the next lines, we present you some interesting facts and figures that relate to the Forex market and Forex trade.
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1. Forex is an ancient market
The general public has within the last decade become aware of the Forex market, although the market has been present for centuries. This type of market emerged in ancient times as the money exchange transaction can be found recorded in Talmud and Egyptian papyri.
2. The average number of transactions per year is 218
The average number of transactions made each year by Forex trader is 218, or 1 transaction per day given that there are approximately 217 working days in a year. Some traders are much more active than others.
3. US dollar is dominating the market
The US dollar and its pairs dominate the Forex market since it features in approximately 80% of trades. That’s amazing considering that in a regular trading day, more than five trillion is traded.
4. 10.03 € is the average daily loss per trader
10.03 € is the average daily loss of a Forex and CFD trader. Let’s take a point of comparison with a pack of cigarettes is € 7.30, or € 219 in costs per month if you smoke a pack per day. Trading is therefore as expensive as smoking a packet per day (20 working days on average per month, i.e. 10.03 * 20 = 200.60 €
5. NY is not the capital of FX
Although the dollar is dominating, Wall Street is not the most important trading exchange. The capital of Forex is London. LSE handles over 40% of the market, while the US dollar market handles around 19% of the total market.
6. GBP/USD is a called a ”cable” currency pair
Before the emergence of internet and satellite communications, a transatlantic cable was a connection between the London and New York markets. Due to this fact, the GBP/USD currency pair is also popular as the cable.
7. 2030.40 € is the average loss of a Forex trader per year
This is the equivalent of the average net salary in the EU, which is around € 2,000. Each year, a Forex and CFD trader loses on average the equivalent of a month’s salary!
8. The origin of the term ”bearish and bullish” market
The origin of the term bears and bulls market trends arises from the fact that bears attack their prey downwards while the bulls do the opposite striking their prey upwards. Therefore, optimistic traders are bullish while the traders with pessimistic expectations are bullish.
9. 1843 € is the annual median trading result
1843 € is the annual median trading result for Forex and CFD traders. That means that half of the traders lose more than 1,843 per year and the other half have a trading result above € 1,843.
10. The average loss over a year is 2,177.40 €
When we know that the average loss over a year is € 2,177.40, it shows there are strong disparities between traders, that the distribution of losses is unequal. Losing traders lose a lot of money.
11. The average loss on a transaction in Forex and CFDs is 9.95 €
The average loss on a transaction in Forex and CFDs is 9.95 €. The more leverage you use, the more you can lose on a trade. The amount of your losses on trade should normally never exceed 1% to 2% of your trading account. Based on this average of € 10, you must have at least between € 1,000 and € 2,000 in your account to comply with the risk management rules. If you cannot deposit that much, either you do not trade (or trade on demo), or you have to comply with certain constraints.