LeapRate Exclusive… Given the rapid stock market recovery over the past two days, people will probably not be referring to this past Monday’s 4% drop in the equity markets as ‘Black Monday’ for very long.
And in fact, Monday was likely a very good business day for those brokers and platforms which remain fairly well hedged and act mainly in an STP/ECN capacity, earning their revenues on a volume-based basis.
As liquidity provider Sucden Financial pointed out in an interview with LeapRate earlier this week: This has got to be good for STP brokers.
And indeed, LeapRate has learned that Monday’s action provided the second-best day ever volume-wise for Forex ECN Hotspot FX, recently acquired by BATS. Hotspot saw FX volumes crossed on its platform top $59 billion on Monday August 24 as volatility soared in the currencies market.
The $59.3 billion trading figure was second only to the $61.7 billion in trades Hotspot FX cleared on January 15, the day of the now-infamous Swiss Franc spike as the Swiss National Bank surprised the markets by taking the brakes off of its protect-the-Swiss-Franc-from-rising policy.
Hotspot normally sees trading on its platform in the $25 billion average-daily-volumes range.
The upshot?
Well, it looks like a normally seasonally slow August trading season may turn out to be a very good month for a number of the world’s leading FX trading platforms and brokers. We should begin to learn more mid next week, once August volumes begin to be formally reported. Stay tuned to LeapRate…