One of the joys of keeping odd hours is that you hear all sorts of things that make you go WTF. So I was not surprised to hear in the wee small hours someone extolling the virtues of FX. Their basic pitch was FX is the most volatile market in the world .Therefore, this translates into more trading opportunities. Lets leave aside the notion that volatile equals trend which equals trading opportunities because this is a fundamentally false assertion and is only sprouted by those who have a complete and total lack of understanding as to how price action works. What I want to look at is the belief that FX is the most volatile market in the world since this is a wonderfully easy notion to test.
Firing up the old spreadsheet I generated the figures below that compared a handful of pairs to a few odd bits and pieces. The results might be a bit of shock for those who follow the traditional mantra about FX because I can guarantee you that if you ask any mug punter what was more volatile the USD/AUD or NAB all would vote for USD/AUD and they would be wrong. The pairs I looked at were all less volatile than a staid dividend yielding blue chip stock such as NAB.