Forex appeal set to continue
Speaking at FX Week's annual congress in London last week, he said: "Currencies will always weaken, but for every one that goes down, another goes up, and so the market doesn't suffer as a whole. FX offers an attractive combination of liquidity and transparency."
Accessibility is also key: "Because of 24-hour trading and inefficiency, combined with the fact the market is unregulated, there are limitless opportunities to trade." The inefficiency stems from the fact that people buy currencies for different reasons – either because they expect them to increase in value, or because they need the funds for other activities. "That people are forced to buy currencies provides an opportunity to play against that market and thus to leverage that inefficiency for short-term gain."
These factors should help FX to withstand growing competition for investor funds from other asset classes, he said. "The Bank for International Settlements 2004 figures show the vast growth of FX trading over the past 15 years and it is difficult to see that stopping."
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