"Australia has the biggest potential for growth, as it has the largest number of people who intended to start trading out of all the countries that we research," Investment Trends senior analyst Pawel Rokicki said.
The Australian FX market is relatively small in terms of its overall size, but it is already much larger than overseas markets, the survey found.
"Our modelling shows that 54,000 individual investors in Australia traded foreign exchange at least once in 2011," Rokicki said.
"This is a relatively large market, as even though FX traders account for only 0.30 per cent of the Australian adult population, in a relative sense this level of penetration is much higher than in many other markets examined by Investment Trends."
In comparison, only 0.14 per cent of adults living in the United Kingdom traded in FX, while in Germany this percentage was even smaller at 0.03 per cent.
The difference can be explained by a combination of the strong Australian dollar, proximity to Asia and a relatively mild regulatory environment, Rokicki said.
In contrast to many other investment markets, there is no dominant provider in terms of market share in the Australian market, he said.
IG Markets has the largest market share with 17 per cent of primary relationships, while FXCM has 11 per cent and CMC Markets 9 per cent.
Primary relationships include the number of clients that use the provider as their preferred trading platform.
FX trading involves taking a usually leveraged position on a currency pair in order to gain from movements.