Every three years, the Bank for International Settlements (BIS) conducts a survey of global foreign exchange (forex) trading. This survey represents the market’s most comprehensive source of information on global forex trading volumes and turnover. During the survey period in April 2013, foreign exchange markets averaged $5.3 trillion in turnover per day. In April 2010, trading stood at $4 trillion, and in April 2007, $3.3 trillion. As markets continue down the path of globalization and market participants transact, hedge and speculate, global foreign exchange trading volume will continue to grow. Given this dramatic increase, investors should consider what role currencies play in their portfolios.
In our opinion, the most interesting developments in the 2013 triennial survey had to do with emerging markets. For the first time, the Mexican peso and the Chinese yuan made it into the top 10 most traded currencies in the world. In fact, both currencies actually doubled their overall share of trading volume since the last survey. Also markedly increasing in trading volume since the last survey was the Russian ruble. In our view, this is a result of recent reforms Russian policy makers have made in order to increase local market access.