Tom Arran Tom Arran, Tuesday 28th May 2019, 5:04 PM CEST
Spain’s FX Market

Spain’s FX Market Recuperates

Spain recently fell into a recession; the country was formally the fifth largest economy in the European Union. However, all industries in Spain are starting to recover and recuperate their losses. The foreign exchange industry was affected significantly by the recession. All brokers saw lower trading volumes across the board; international brokers stopped trading with Spain’s FX Market until recent. The Spanish Market now falls under the guidelines and regulation of the European Securities and Market Authority, allowing for security and industry-wide reparations to begin.

The Spanish Foreign Exchange Market is connected legally to the Spanish Stock Market, including all fixed-income markets and derivative markets. The largest stock market hub out of the four available in Spain is the “Bolsa de Madrid”. This stock market exchange focuses primarily on the IBEX 35 Index, which are the thirty-five most traded stocks in the country of Spain. These stocks are once again on the rise and being traded regularly thanks to the new regulation implementations from the ESMA.

Spain’s FX Market Stabilised by ESMA Regulation

The National Securities Market Exchange in Spain is the country’s local regulator. Their duties include supervising and inspecting the foreign exchange brokers trading in their country. All brokers must comply with the regulation implemented by the NSME and will now also have to follow additional rules stipulated by the European Securities and Market Authority. The most significant change to regulation that will affect brokers is the new Contracts-for-Difference intervention measures. These measures include leverage restrictions on trading instruments; it also means new marketing caps and binary option bans.

These new laws haven’t just impacted the Spanish FX Market, but it’s affected all FX Markets across the European Union. There has been an incredible drop in activity and volatility from clients since the measures were implemented. However, there are analysts at companies like eToro that believe these changes will benefit the country going forward. It’s allowed for significant confidence in the FX Industry and has given traders more control. The ESMA Regulation will prove to be beneficial for Spain and all European Union Countries.

Spain’s Top Brokers

The top brokers in Spain can trade with the largest brokerages in the European Union, including eToro and CMC Markets. This wasn’t plausible until the European Securities and Market Authority regulated the Spanish market. The top brokers currently operating in Spain include ClickTrade and DIF Broker. However, with the new laws implemented, there is a chance that other brokers like IG will become the country’s top brokerage.

Spain’s Average Trader

The average trader in Spain uses Euro’s or the United States Dollars to trade with foreign exchange markets. This is because the country tends to be conservative, focusing on the guaranteed currencies that at some point, will rise in value.

During an interview with magazine “Finance Magnates”, Javier Molina of eToro commented on Spain’s future in the global FX Market by saying: “Investors in Spain are more likely to be male, older than 26 and college educated. Investors with lower portfolio values tend to hold a less diverse mixture of investments than those with higher portfolio values. Just 14% of those with investments use products with leverage. In general, they tend to be conservative and when trading, really concentrated in no more than 2 or 3 assets. FX and cryptos are currently the most traded assets for Spanish investors on eToro.”

Primarily FX Trading in Spain occurs on near-term CFD’s, as brokers and traders prefer to have a portfolio with low to medium volumes. This is because there’s a trend of market liquidity in Spain as a result of new regulations and the global economy.

Tom Arran

Author: Tom Arran

Tom has over 10 years experience on crypto currencies, first mining bitcoin on an old university computer for 20 cents a coin to now day trading bitcoin in between helping to start whichbroker.com. Tom has previously held roles at a leading EU brokerage and provided insight and consultancy work for number of UK banks in Crypto. Tom Arran can be contacted at [email protected], View all posts by Tom Arran

Featured Brokers

  • EagleFX

    Open EagleFX Account

    Read EagleFX Review

    CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

  • FXPesa Review

    Open FXPesa Account

    Read FXPesa Review

    CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

  • Pepperstone, TrioMarkets, Nano Bitgrail

    Open Tiomarkets Account

    Read Tiomarkets Review

    CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

More From Author