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GFT Has Highest Profitability Rate in Q1 2011

The first quarter of 2011 has ended, and US broker has released very interesting figures. GFT now has the highest profitability rate in 2011, but the race is very close. Apart from profitability rate, the number of traders was also reported, and there are interesting findings.

The new CFTC rules limit leverage in the US, but they sure have some positive parts as well. One of the new regulations requires brokers to publish the profitability rate of their traders, and the number of their accounts. The calculation methods have been challenged and modified several times, and they seem more logical now.

Michael Greenberg publishes his excellent quarterly report summarizing and analyzing the data released by the brokers. Here are my takes from the figures:

  • GFT’s client’s have a profitability rate of 39.9%. Oanda, that had a positive rate in Q3 2010, now fell to second place, but they’re not too far behind, with 38.1%.
  • Oanda has the the largest number of US clients. Even after a significant reduction of newly defined inactive accounts, Oanda still has almost 30,000 active clients, and leads the pack.
  • FXCM, that made an IPO in December, has enjoyed a big gain in the profitability rate and a big gain in the number of clients.
  • Average profitability is on the rise, +2% on average. Despite removing accounts that are profitable only due to interest rate, traders are becoming more successful.
  • The known numbers that 85% of forex traders lose (or even 95% according to some whispers) is far off. The actual figures are much better, and gradually improving.
  • The number of US accounts is stable.

Remember that the profitability rate of your broker’s clients doesn’t necessarily reflect your chances. But it’s still very interesting to see where your broker is located on the list. See it here.

I believe there will be further modifications to the calculation methods, as these rules and reports are relatively new. More analysis on the meaning of these  numbers  will follow.

Further reading:  5 Points on How to Chose a Forex Broker in 2011


Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.