Still early days for the retail boom

The 'Best retail platform' category has received by far the most pitches, with entrants from as far afield as Moscow and Singapore. And as major banks also start to recognise the potential for picking up the relatively fat margins that private investors can deliver, it is turning into the place to be for those looking to expand.

As with any market seemingly in the midst of an all-out party, however, there is always a fear of the dreaded morning after. But it does seem, for now at least, as if the DJ has only just turned up. Japanese investors, a canny and cautious bunch at the best of times, are reportedly piling into FX in a big way. While this is partly due to the particular circumstances of the yen, these investors are also seeing the benefits of an asset class that is liquid, fast-moving and low-margin.

Where Japanese investors lead, others often follow; housewives famously piled into gold ahead of its sharp price hike at the start of the decade. The increased access to forex trading should enable an army of wealthy individuals to pit their wits against the market in a way that is less intermediated than almost any other means of investment. If, for example, you have a firm view that Hilary Clinton will win the next election and that it will cause the US economy to flounder, a bet on the dollar falling is the most direct way of taking this view.

Unlike unit trusts or structured products, forex trading needs no minimum investment, can be accessed on a daily basis with no entry or exit costs and does not pay commission to cash-hungry financial advisers. However, the flip side of this is that there is no protection, and some investors will inevitably get carried away, gambler-style, on trying just one last punt to recoup the losses they have already made.