Cost of trading sways FX traders when choosing broker

Regulation tops list of concerns globally for FX traders, as they agree cost effectiveness dictates reasons behind choosing a broker.

The majority of foreign exchange (FX) traders in the US and across Europe have agreed the cost of trading is the main priority when selecting a new broker.

Almost half of US FX buy-siders - 57% - said cost effectiveness is the main driver when selecting brokers, and a third of participants in Europe agreed.

TradeTech FX revealed the statistics following a recent poll of 100 senior FX market participants, identifying challenges in the FX market.

European FX traders highlighted quality of research as their second priority when looking at brokers, with 26% stating it is the most important factor.

Only 2% of FX traders in the US said quality of research impacted the decision to use a broker, making it the least important reason.

Regulation and compliance - particularly in Europe - was underlined as a challenge for FX traders, with almost 60% agreeing it is the biggest concern.

US traders on the other hand, said reporting and transparency was the biggest challenge, closely followed by regulation and accurate risk analysis.

The report explained: “Concerns around the implementation of new regulatory guidelines top the list of priorities [in the next 12 months] for both European and US FX traders.

“However, in Europe we saw a greater focus on conduct and behaviour and identifying new market opportunities.”

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