When I first started in the FX market, back in the distant days of 1981, FX was regarded as a bit of a spivvy market. Over the years, I’ve certainly met “barrow boys”, the sorts of characters popularized in the UK television series Only Fools and Horses. However, the market has changed, and these days you’re more likely to meet an academic with several degrees and an MBA to boot. FX is now mainstream. In fact, it’s so mainstream that it’s becoming the steady Eddie of investment banking. The spivs have moved on and in recent years they’ve been spotted in areas, such as commodities and more recently credit, where they’ve been allowed to mark positions to myth, book the profits up front, trouser big bonuses and then let some poor Herbert sort out the mess.
This is nothing new and has happened in market after market over the past 25-years. Meanwhile, FX keeps chugging along like a London taxi. Other markets are more like Ferraris. Pleasing on the eye, fast out of the blocks but ultimately a little bit weak, or at least temperamental mechanically.
The beauty with FX is its liquidity, so there’s almost always a price at which you can get out of bad positions.