Steigen Makler on Latin America’s Transformation into a Trading Activity Hub
LONDON, UK / ACCESSWIRE / September 24, 2018 / Global investors are turning their attention to emerging economies as opportunities dry up in the mature financial markets of the developed world. Resource-rich Latin America is one of the most appealing destinations, but its attraction is due to a combination of factors that extend beyond natural wealth and commodity booms. Latin American financial service providers are quickly building up their expertise, and the region’s capital markets are progressing fast in terms of infrastructure, technology, and product diversity. Countries like Brazil, Mexico, and Chile have achieved impressive growth in their derivatives markets, while many others have built vibrant forex, equities, and fixed-income platforms. With local economies on the mend and political stability returning to the region, expectations are that Latin America will be one of the most active contributors to global trading activity. Furthermore, an expanding middle class and rising disposable incomes are accelerating the participation of retail investors, prompting exchanges and brokerage services to improve and further diversify their product offerings. The combined effect of these factors has raised the profile of Latin America and helped it become a busy trading spot, especially in the derivatives market segment, comments Steigen Makler, a regulated brokerage service based in the UK.
A key reason for the surge in Latin American capital markets over the past decade has been a concerted effort by exchanges to attract more domestic and foreign investors. They sought to draw high-frequency traders by introducing direct market access and moved to bolster market integrity and ensure fairness through implementing surveillance and risk management systems, as noted by Carlos Patino, NASDAQ’s associate vice-president of market technology. In addition, Latin American exchanges diversified their revenue streams with the launch of new products, among them highly complex, structured instruments. Now the use of new technologies is helping exchanges, broker-dealers, clearing houses, and regulatory agencies establish a solid framework for over-the-counter (OTC) products, where demand is particularly strong – according to one study, OTC activity accounts for approximately half of derivative markets turnover in emerging economies as opposed to roughly one-third in developed countries. Latin America also offers investors the opportunity to trade in financial instruments that are either unavailable in some jurisdictions or excessively regulated, a prime example being contracts for difference (CFDs), SteigenMakler notes.
The interest of global investors in the region was recentlyhighlighted by Jesus Togno, FTSE Russell’s director for Latin America, who told Bloomberg that the UK-based index provider was forging numerous local partnerships in response to strong demand for exposure to emerging markets. “We see opportunity for our business equally between Latin America and emerging markets in Asia. This is because institutional investors globally are trying to diversify. Recent developments have shown the professionalism of these markets has evolved and they’re offering very interesting profiles,” Togno commented. With a growing base of well-informed retail investors, a wealth of investment products, increasing sophistication on the part of service providers, and strengthening economic fundamentals, Latin America is emerging as a dynamic trading hub with constantly expanding transaction volumes.
Steigen Makler, a financial brokerage service with commercial offices in 14 countries, offers its clients an innovative trading platform and a product portfolio focused on shares, commodities, indices, and cryptocurrencies. By providing expert advice and 24/7 support via phone, email, fax, or live chat, the company strives to ensure the best possible trading experience and maximum returns for its customers. Steigen Makler is regulated by the UK Financial Conduct Authority and the Cyprus Securities and Exchange Commission.
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SOURCE: Steigen Makler