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EFX Users Plateau, But Volume Increases

Growth in electronic foreign exchange (eFX) trading has reached a plateau, according to new research from Greenwich Associates.

Growth in electronic foreign exchange (eFX) trading has reached a plateau, according to new research from Greenwich Associates. From 2004 to 2005, the percentage of large corporate and financial users of foreign exchange services doing their trading online remained static at about 44 percent. The survey of 1,549 corporate and financial users of foreign exchange services further reported that the proportion of FX e-trading holdouts that plan to begin trading electronically in the next 12 months remained flat.

However, although the total percentage of users remained stable, fund managers and pension funds saw a meaningful increase in volume traded electronically, says the report. In 2005, fund managers and pension funds reported trading 61 percent of their total FX volume electronically, up from 53 percent in 2004. Greenwich Associates attributes this growth to growth in cross-border investment activity and a penchant among fund managers and pension funds to trade FX as an independent asset class. <<<

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