Handbook of Exchange Rates

1.5 Survey of Multibank FX Platforms

To better understand FX activity on multibank trading systems and electronic brokers, the authors conducted a survey of 15 institutional and retail platforms. Table 1.9 shows the results from the authors' survey. The 10 institutional platforms that participated represent as much as 30% of spot FX trading globally and 22% of FX swaps.²¹ The five retail platforms surveyed captured another 5% of global spot FX turnover. Activity on multibank platforms has grown strongly over the past three years, with weighted-average daily turnover rising by 20% for the institutional platforms and by over 300% for the retail platforms. The average trade size is $2 million on institutional platforms and around $60,000 on retail platforms, with the latter handling many more transactions on a typical day.

Table 1.9 Survey of 15 Multibank Platforms for FX

The most active participants on institutional platforms (in order of importance) are banks, real-money investors, and leveraged investors. Trading on institutional platforms is even more concentrated in spot (53%) and FX swaps (46%) than it is in the rest of the market.

The client base and nature of trading varies considerably across platforms. EBS and Thomson Reuters serve the interbank market, with significant activity by algorithmic and high frequency traders who gain access via prime brokerage relationships. ...