This year, much like last year, has been extremely challenging for many economies around the world, especially for those on the African continent. It was a driving force behind the emergence of new forex traders in Africa who have taken to the various financial markets to secure an additional income.
Retail forex trading only represents a small portion of the global currency market, around 5.5%, but it shows slow, yet steady increase, especially in Africa. There have been many advances made in technology along with higher expansion of the internet, and an increase in the number of brokers in the field.
Forex traders in Africa are harnessing all the trading tools, sources, and materials to their disposal to enter and success in the forex market according Regional Forex Analysts – Forexsuggest.com
Why is forex trading increasing in Africa?
The forex market is easy to access and the advantage that many new traders have is that they do not need to have a lot of capital to start trading forex. There are also many forex brokers who accept forex traders from many African countries, especially Nigeria and South Africa, which are the leading countries with the most traders currently.
In addition to this, there is improved telecommunication across the African continent, increasing internet access in many homes, allowing forex traders to access the largest, most liquid market in the world.
With the forex market being so large and with more than $5 trillion in transactions taking place daily, there are lowered transaction costs, which means that African traders can start trading easily, if provided with the opportunity.
African traders also have a plethora of trading possibilities using both simple and advanced trading strategies. These can be used to earn profits despite the market conditions on the day off trading.
African traders are also provided with high leverage ratios, helping lower margin requirements at the start of trading, giving them the opportunity to open larger positions which increases their chances of making big profits.
Proof that forex trading is exploding in Africa
There are many regulated forex brokers who can substantiate that forex trading is increasing rapidly in Africa. The following brokers experienced growth during the 2020/2021 period:
- Exness saw growth of 100% in trade volume, especially from clients in Africa.
- The African market for XM.com grew by 35%.
- AvaTrade experienced a 20.2% growth in Africa.
- CM Trading saw a steady increase of 22% in clients, especially in Africa.
Apart from South Africa, Nigeria is the country which hosts the most retail forex traders, with more than 300,000 traders who are active in the forex market. Of whom, 46% women who have registered a live trading account in the past year, with the youngest traders, ages between 25 and 34.
The most traded currencies in Africa are:
- Tunisian Dinar (TND)
- Botswana Pula (BWP)
- US Dollar (USD)
- Nigerian Naira (NGN)
- Seychellois Rupee (SCR)
- Egyptian Pound (EGP)
- Zambian Kwacha (ZMW)
- South African rand (ZAR)
- Kenyan Shilling (KES)