Australian Forex market overview

Author: Han Ong

Soon, the TFB team will fly to Sydney to join other industry experts at the Finance Magnates Pacific Summit, one of the biggest expos of the year.

Australia is one of the main players in the region. It’s a fascinating market with unique tendencies and rules. Let’s examine what the Australian market actually looks like.

• AUD, the Australian dollar, is among the most traded currencies in the world.
• Similar to the UK financial authorities, the Australian Securities and Investments Commission (ASIC) is a strict regulator that raises the barrier of entry for brokers and hedge funds. Although these constraints make it harder to operate in the region, the market is well-regulated and more secure for all participants.
• Speaking of market participants, the region is bursting with different types of entities, including retail brokers, hedge funds, private and institutional investors, and countless liquidity providers.
• Thanks to its location, the Australian market benefits from sharing trading hours with Asia, boosting trading between all countries in APAC.
• The growth of retail trading in Australia is undeniable, making it one of the many countries benefiting from new traders entering the market. This also means, though, that they face the struggles of accommodating and adjusting to a brand new niche of clients who may have zero previous trading experience and knowledge, therefore being susceptible to higher risks.
• The adoption of advanced technology helps the Australian Forex market expand and grow faster, contributing to a more sophisticated and versatile approach to trading.

The Australian Forex market is robust and dynamic, yet it remains quite volatile despite strict regulations and advanced technology. This volatility is largely due to the national currency's close ties to the local economy and, specifically, natural resource prices. As is often the case, this situation presents both risks and opportunities for brokers, hedge funds, traders, liquidity providers, and others involved.

One of the best ways to secure your position in the volatile market include:

• Diversifying your service offering, such as providing traders with access to multiple asset classes and opting for unique products, such as synthetic symbols that few offer as a part of their portfolio.
• Maintaining an up-to-date risk management strategy is crucial. At TFB, we emphasise that creating a smart risk management plan isn't a one-time task. Given the fast-paced nature of financial markets, it's wise to review and update your policies at least every six months to ensure that you're not exposed to new or emerging risks.
• Automating as many processes as you can while maintaining a top level of service and security. Automation is arguably the best way to minimise your daily risks. Many tasks are mundane and repetitive, yet critical. Increasing automation in a brokerage allows you and your team to have more time to monitor trends, engage with key clients and partners, and plan for the future. By reducing the workload, you avoid feeling overwhelmed and can catch important details that might otherwise be overlooked when you're constantly busy.