When it comes to building influence in foreign-exchange markets, institutions from CME Group Inc. to the International Monetary Fund can take a lesson from a Barcelona-based website with a staff of 50.
FXStreet News is ranked top worldwide among Twitter Inc. users of currency-market analysis, according to data compiled by Bloomberg based on followers, retweets and frequency of posts being tagged as a “favorite.” The website publisher of in-house and outside research on foreign exchange is run by Francesc Riverola and Miriam Pinatell, the husband-and-wife team that founded it in 2000 with web developer Sergi Fernandez.
Now FXStreet is looking into other asset classes, because ever-smaller price swings in the $5.3 trillion-a-day market make it harder to profit from its traditional revenue sources -- advertising and online tools for foreign-exchange brokers.
“The lack of volatility has made trading very slow and a lot of traders are switching markets,” Chief Executive Officer Carolina May said in an interview from Barcelona on July 24. “What we are trying to do is adjust the news to other markets that are moving more than forex.”
FXStreet will add content on some “CFDs, ETFs and others, covering oil and gold, but from a forex perspective,” May said, referring to so-called contracts for difference and exchange-traded funds. The platform caters to retail investors, a segment that accounts for 3.5 percent of currency trading, according to Bank for International Settlements estimates.
Financial companies are struggling to cope with slower price movements in currencies and bonds. Danske Bank A/S Chief Executive Officer Thomas Borgen signaled last week he’ll cut jobs unless investors return. Deutsche Bank AG’s Currency Volatility Index, based on three-month options for nine major currency pairs, fell to a record-low 4.93 percent on July 21.
Currency-trading for retail investors took off in the mid-1990s, with international banks offering products such as dbFX, operated by Deutsche Bank, the world’s second-largest currency trader. While the wider availability of the Internet toward the end of the decade spawned a proliferation of firms acting as middlemen with banks, the industry has been hit with increased regulation and the slump in volatility.
By Twitter followers alone, FXStreet lags behind the largest financial institutions, with 49,800, compared with 350,000 at the IMF, which placed at 33 in the Bloomberg ranking, and 763,000 at derivatives market CME Group, which was 12th.
Bloomberg News competes in the online market to provide currency news and opinions.
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