There is an old saying in Financial Services that the markets never sleep.
In fact, that was correct even before the advent of modern information technology towards the last decades of the twentieth century but today the integrated high-tech world makes it truer than ever.
What this means for foreign exchange markets and leading-edge currency exchange brokers is that a strategy needs to be developed in order to exploit the changing market realities 24 hours a day.
To understand that, it’s necessary to think a little bit about geography.
For historical reasons, the really big foreign currency exchange markets are in London and New York. London is actually the largest global FX centre followed by New York with Tokyo a fairly distant third with 7% of the market
So, it’s really in the northern hemisphere where the vast trades are conducted.
It is also important to remember that, although the markets never sleep, in reality the traders and supporting infrastructure does and for that reason there are associated ‘open market times’ for each of the major centres.
Globally, the most important time of the 24 hour day is when the opening times of the FX markets in London and New York overlap.
At that time of the day, the foreign exchange markets are particularly active and volatile. What that means, for experts such as the Forex Group, is simple – it represents opportunity.
Of course, a lot of this is happening in the middle of the night in Australia and that’s why we often recommend to our clients that they ask us to trade on their behalf and at a time when we can lock in some of the best rates around – and that might well be outside of what are considered to be normal working hours in the southern hemisphere.
The bottom line is simple. We know the best time and place to strike in order to obtain some of the best rates around for you.
That sometimes means that the transactions will take place on the global marketplaces at what might locally seem to be strange times but the opportunities can be significant and it is a better strategy than simply trying to get exchange rates during the working day at a bank branch, based upon what happened 12 hours ago in Europe or the USA.
This is one of the reasons why our rates are so attractive and why we would like the opportunity to prove that by providing you with this service.