Forex market continues to attract local investors
The UAE investors continued actively trading in foreign exchange (forex) currency markets in 2009 even as worldwide volumes took a hit, said a senior executive of a Swiss-based online foreign currency broker.
"In 2009, economies suffered the worst recession since the great depression. Volumes did go down but there was increase in percentage of trades in this market compared to other markets," said Mario Camara, Managing Director of Advanced Currency Markets (ACM), Middle East and Asia.
Camara said forex trading was preferred by many investors even amid the crisis.
Property and stock market investors have been migrating to forex as an investment alternative. This migration has actually been a growing global phenomenon since last year. Investors find forex trading very rewarding as they can make money both on the upside or downside, he said.
"Even if one currency goes down, it depreciates against another one and people can make money," he added.
Forex market has become the world's largest financial market and according to estimates daily volumes exceed $3 trillion (Dh11trn).
He said volatility in equities made them a relatively unattractive option and on the other side, low interest rates deterred many investors from keeping their money with banks. "As a result we saw many investors pull their money out of equities and put in forex trading."
Even as it is premature to talk about performance in 2010, said Camara, the outlook is bright. "We cannot go by performance in January. But we are very positive about this year. We have passed the recovery point and are on the recovery slope. Things look better now and 2010 would be a much better year for the sector. Markets are rebounding."
Keep up with the latest business news from the region with the Emirates Business 24|7 daily newsletter. To subscribe to the newsletter, please click here.
Follow Emirates 24|7 on Google News.