Looking back on 2018

Fortrade’s Top 5 Assets

If nothing else, one can certainly say that 2018 was an interesting year in the world of finance. Between the pending British exit from the EU in Europe, to the tariff wars between the China and the United States, to the investigations, claims, and counterclaims surrounding the U.S. presidential elections, global markets were fluctuating all year long and investors scrambled to predict what would happen next.

For traders at Fortrade, this meant no shortage of possibilities and assets upon which to open positions – both long and short. Over the course of the year, nearly 1.8 million trade positions were opened on Fortrade’s nearly 10,000 active accounts. Of those positions opened, more 84% were opened on the top 5 assets. Below is a summary of those 5 top assets on which our traders opened positions in 2018.

#5 – Gold (USD)

As a general rule, when global currencies are less certain, gold is regarded as a safe fallback for investors. That being said, despite all of the uncertainty surrounding the USD, GBP, and EUR, gold remained relatively consistent throughout 2018. The precious metal fell 2.7% for the year, opening in January at $1,317.31/oz. and closing on December 31 at $1,282.29/oz. Even the fluctuation was relatively mild, with the high for the year of $1,366.08/oz. in late January and a low of $1,160.88/oz. in mid-August.

Nevertheless, it was a very attractive trading asset for Fortrade traders, who opened a total of 105,266 positions on Gold in 2018. Of these, 56% were long positions (traders buying), and 44% were short positions.

While it is hard to predict if 2019 will prove to be bullish or bearish for Gold, it is safe to say that it will continue to be an asset of interest over the coming year.

#4 – GBP/USD

Considering that both the United States and Great Britain experienced an exceptionally tumultuous 2018, it should come as no surprise that the currency pair of the British pound vs. the U.S. dollar was a highly traded asset. In this battle between the currencies, the dollar clearly won, as the GBP/USD opened 2018 at 1.35, and fell nearly 6% over the course of the year to close out the end of December at 1.27. For traders at Fortrade, 148,123 positions were opened in 2018 on the GBP/USD, with a very even split between long and short positions opened (slightly more long than short).

2019 has opened with continued geo-political realities on both sides of the Atlantic. Britain is scheduled to break off from the EU (Brexit) in March, and recent U.S. midterm elections divided the leadership in Congress giving the Democrats control of the House of Representatives while Republicans maintained control of the Senate. Considering all of that, it seems very likely that the GBP/USD will remain a very active asset in the coming months, and certainly worth keeping a close eye for trade opportunities.

#3 – USD/TRY

On the one hand the appearance of the USD/TRY is a surprise, as the most heavily traded currency pairs tend to be what are known as the “Majors’ (the USD against one of the six other major world currencies), so seeing the dollar against a much less traded currency like the Turkish lira is indeed unusual. On the other hand, this past year saw a lot of tensions between the United States and Turkey, so this should not come as too big of a shock. Overall, the dollar performed very well against the lira in 2018, rising nearly 40% on the year from 3.795 to 5.270. However, between mid-August and the end of the year, the dollar dropped 24% from its high of 6.953.

Tensions do not appear to have subsided yet in the new year, so this may remain a popular trading asset in 2019. Last year, 51% of the nearly 200,000 USD/TRY positions opened by Fortrade traders were long positions.

#2 – EUR/USD

Just as the abovementioned GBP/USD has been particularly volatile due, in part, to the pending Brexit, and in part to the political unrest in Washington, DC, the EUR/USD has also been greatly affected. Of course, even when it is “business as usual” in both Europe and the United States, this is consistently one of the most heavily traded assets (in 2017, it was also the second most traded asset among Fortrade investors).

The strength of the dollar increased this past year over the euro, but not by such a large margin – closing out the year 1.1493, or 4.3% lower than the beginning of 2018. During that period, the number of positions opened at Fortrade on the EUR/USD reached 247,874, 51% were buying, and 49% selling.

As with the USD/GBP, 2019 has opened with no signs of the tumultuousness receding either in Europe or in the U.S., and investors can look forward to another very volatile year between these two major global currencies.

#1 – Crude Oil

Another perpetual “Top 5” asset is crude oil, which in 2018 was the most traded asset at Fortrade, having been #5 one year earlier. While the price for commodities in general is often determined by supply and demand, with crude oil that supply and demand is often also determined by geo-political factors.

Crude opened 2018 looking very strong, with the price rising from its January 1 level of $58/barrel to $75.69 as late as the beginning of October. However, in the final 3 months of the year, the price plummeted by 39%, closing at the end of December at $45.81, or down 21% from the beginning of the year.

Nearly a quarter of a million positions on crude oil were opened by Fortrade traders this year, of which 53% were long positions. As the opening weeks of 2019 have already demonstrated, there is enough uncertainty in global markets and geo-political realities to keep the coming year very interesting in terms of volatile assets. And by all accounts, crude will continue to be one of those to watch closely.