Mark Snyder Executive Vice President,State Street Global MarketsChairman, the Foreign Exchange Committee
Mark Snyder Executive Vice President,State Street Global MarketsChairman, the Foreign Exchange Committee

Ethical e-FX: self-policing and supervision versus regulation

Ethical e-FX: self-policing and supervision versus regulation Mark Synder outlines why ethics matter in the foreign exchange market and how market-based discipline plus supervision equals a healthy marketplace.

First Published: e-Forex Magazine 23 / Leader / April, 2006

Introduction Foreign exchange markets are a remarkable success story. With the rapid expansion of world trade, increased cross-border investment flows and the arrival of newly liquid, tradable currencies, the world’s largest financial market is a constantly evolving 24/365 digital network that seamlessly ties together the global economy.Since 1989, global foreign exchange turnover has more than tripled to over $2 trillion per day. According to the October 2005 report of the Foreign Exchange Committee’s Survey of North American Foreign Exchange Volume, average daily volume in that region totaled $440 billion – a remarkable 31.2% increase over October 2004.There have been bumps along the road -- scandals involving unauthorized trading, fraud, and unprofessional trading practices. But, despite the fact that the OTC forex market is essentially supranational and not proscriptively regulated the ethical character of the currency market is as good as or better than that of any other financial...continued

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