October 10, 2009

Singapore Foreign Exchange

The Singapore forex exchange market is one of the largest Asian forex trading floors, considered second in importance after Tokyo by many sources in the region. Hong Kong is another major Asian financial center.

Turnover

The 6 monthly survey carried out by the Singapore Foreign Exchange Market Committee in October 2008 found an average daily turnover to the value of US $262 billion in 'traditional' forex trading plus another US $28 billion in OTC foreign exchange derivatives.

Traditional forex trading includes spot transactions (average US $106 billion per day), outright forwards (average US $56 billion per day) and foreign exchange swaps (average US $100 billion per day). Derivatives include currency swaps and forex options.

Currencies Traded

Of course the Singapore dollar is not one of the major currencies but this does not affect the turnover. The most widely traded currency pair in Singapore, as in the total world forex market, is EUR/USD with USD/JPY second and GBP/USD third. In Singapore the local currency (USD/SGD) comes next, followed by the other major pairs, AUD/USD, USD/CHF and USD/CAD.

Market Hours

Trading in Singapore forms part of the Asian forex trading session. Trading generally takes place in the forex market from 8 am to 4 pm local time in any country, Monday through Friday. Singapore time is 8 hours ahead of UTC/GMT or 13 hours ahead of US EST.

Therefore the Singapore forex market would be open from 12 midnight to 8 am UTC/GMT which is 7 pm to 3 am EST. During these times the biggest forex trading centers in London and New York are closed.

This can be a good session for European traders who like to trade their early mornings or Americans trading in the evening, as well as people in Asia and Australia who can trade their own business hours.

However, liquidity is lower during the Asian session than during the London and New York sessions. This can mean that slippage is a little higher: you might not always get the price you wanted. You will need to balance this against the various advantages for you in having this convenient time for your trading.

Singapore Forex Brokers

Many of the major international forex brokerage companies have a Singapore branch. These include CMC Markets, City Index, GFT, IG, Oanda, Goldman Sachs and Morgan Stanley. However you are not necessarily limited to brokers that are regulated within the country.

Forex trading in Singapore requires the same strategies and techniques as you would use elsewhere. Remember that forex trading is risky and you should only use money that you can afford to lose. Taking this into account, if you have a profitable system and good money management then you could find the Singapore foreign exchange market a source of high forex trading profits.

Singapore Foreign Exchange

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