CMC Markets CEO Peter Cruddas explained to FinanceFeeds in Shanghai “We came here not to adventure and speculate, but based on our long-term research and understanding of the Chinese market, and our full understanding that this is a good time to further our business in China. If we had come with a speculative mentality, we would not be evolving in the right direction for the whole Chinese team.” Here is the full report and our interaction with the management team
See the original live report by FinanceFeeds China on www.financefeeds.cn
The Chinese retail FX industry is not only burgeoning but is the pinnacle of the future direction for the entire electronic trading industry.
We have all heard that before, several times, however, as FinanceFeeds as categorically emphasized during the course of the past few months as a result of in-dept research conducted in the world-dominating People’s Republic, this year will represent the very first time that the growth and development of the entire electronic trading ecosystem in this futuristic and leading edge nation will no longer be reliant on having a retail audience one side of the firewall, and the entire system that serves them including execution, client money and market connectivity on the free market side of the firewall.
The traditional and towering network of introducing brokers across China that have been of tremendous interest to Western brokerages for quite some time, with only a handful of large, high quality firms having been able to have garnered any long term and deep rooted business with the most important partners in China, is now ready to move away from being an introducing broker network and toward being a large scale brokerage ecosystem in its own right.
Gone are the days of small to medium brokerages attracting business from mainland China. The only way in 2017 is to have full Chinese operational presence. This applies to brokerage facilities, use of media, hosting and payments.
This week, in a milestone expansion for one of the world’s most widely renowned and well established electronic trading companies, a fully fledged evolution of the firm’s presence in mainland China took place.
CMC Markets, whose provenance in its home territory – London – dates back to 1989 when incumbent CEO Peter Cruddas founded the company, and today, with Mr Cruddas at the helm, provides institutional services globally and has been pragmatically building its Chinese business.
FinanceFeeds was the sole industry specific media at the company’s Chinese launch, as Mr Cruddas, along with CMC Markets Greater Head of China Biyi Cheng, Group Commercial Director David Fineberg, and Head of APAC & CA Matthew Lewis, presented the new operational head quarters in Shanghai to a discerning audience.
CMC Markets set up a new office in Shanghai to increase its presence in China. As early as 2005, CMC Markets set up its first overseas office in Beijing, and CMC Markets will now set up its second China office in Shanghai’s Pudong New Free Trade Area.
FinanceFeeds China was honored to be invited to visit the launch, which carried the designation “Embark on a New Trading Journey with CMC Markets”.
At the opening of the conference, a taste of holographic technology was displayed in order to create a strong visual impact at the same time, representing the technological advancement within the publicly listed British company which is also Australia’s second largest brokerage, the ideology being to provide Chinese investors with professional and transparent international financial services, with the all important sincerity and confidence that is required in the mainland.
“We are coming to China to meet the needs and voices of Chinese customers. Many Chinese customers will choose to use CMC Markets as a method by which to enter the international market to invest, so this entrance into China is a very important opportunity. With CMC Markets 10 Years of growth within this region, in order to better serve the Chinese market, its Asia Pacific office responsible for customer service employs staff of which more than 40% have a Chinese background” said CMC Markets founder and CEO Peter Cruddas during his speech in which he revealed the commercial layout of the Chinese division of the company.
In the Asia Pacific region, CMC Markets has ranked very highly in Australia in terms of market share for the third consecutive year, being responsible for the largest number of high net worth customers, and in terms of overall customer satisfaction has always been among the best in the region, which must be consistent with CMC Markets uphold technological innovation is inseparable.
Addressing CMC Markets senior management team at the launch in Shanghai, FinanceFeeds posed the question “How does CMC Markets plan to create the ultimate user experience for the “next generation” of an active trader, and what is CMC Markets operational approach toward serving Chinese institutional clients through platform technology innovation?”
Mr Lewis replied “As early as 1996, when the computer was not so well developed in the domestic environment, we expended a lot of resources in Europe, by way of independent research and development of IT systems and proprietary platformsplatforms, and now after a long period of development, the entire system has become very mature. We have long been committed to the development of our ‘Next Generation’ trading system, mainly in order to provide a very tailored and high level of service to our investors, and thee most important work that we do is to ensure that our entire system is ergonomically practical for customers, to provide the services they need.”
“There are more than ten thousand different trading functions on the platform, via which we can provide customers with a comprehensive range of financial services” he said.
“CMC Markets used to have offices in 15 countries around the world, serving more than 70 different national markets around the world. Including all the services provided on the London Stock Exchange, can prove that CMC Markets has a great deal of ability to manage risk and provide a truly global experience” said Mr Lewis.
Concluding, Mr Lewis explained “Our platform is continually undergoing further optimization, making it run more conveniently and quickly. We have a special dialogue system that allows us and customers to connect with each other through the platform for real-time communication, and to make corresponding updates. In addition, we have invested more than 100 million US dollars to develop mobile applications, and follow the development of the market and technology, and constantly enrich the product content to meet the needs of investors.”
FinanceFeeds China then asked David Fineberg, Group Commercial Officer “In the global investment market, “multi-asset transactions” have been a frequently referred to aspect recently. Regardless of institutional investors or high net worth of people, the construction of diversified asset allocation, not only can effectively reduce the risk, but also enhance the long-term value-added potential of assets. We would therefore like to ask CMC Markets, with regard to Chinese investors, what multi-asset solution will be offered in mainland China?”
Mr Fineberg responded by explaining “Thank you very much for your question. The products we offer in the Chinese market are the same as those in the world market, mainly to help our customers to carry out fast trading on our platform. Our platform provides a comprehensive transaction package for global traders. The platform is not only 100% automatic, but also offers CFD trading, tradable foreign exchange, stock, stock, commodity and other five asset classes.”
“As my colleagues have just said, there are more than 10,000 different combinations and features on our platform that allow customers to quickly reach the trading tools they need to do. And our tool has a very good trading aids, can help investors in the market to find opportunities, you can quickly find the market which may exist some of the risks, so that our customers can timely defense and resistance to market risk” continued Mr Fineberg.
“We put the inter-agency trading function on the retail platform to the customer to use. Additionally, we have this tool has another very strong function, is to provide better liquidity, we also with many domestic mainstream financial information service providers to provide real-time overseas financial information data, thus if the investor has been in the market for some time and is a skilled trader, then he or she will find features of this nature very useful” said Mr Fineberg.
FinanceFeeds then asked Biyi Cheng, CMC Markets Head of Greater China, whether CMC Markets, which is a veteran brokerage firm listed on the London Stock Exchange (LSE), and has expanded to have regulated offices and divisions in 14 countries since its inception in 1989, has a clear plan that is specific to the company’s future Chinese capital market development opportunities and strategic deployment in China. We also asked Mr Cheng that, when doing business in China, how the firm will achieve a “think local, act global” vision.
Mr Cheng said “CMC Markets has 15 offices in 14 countries. We serve customers from 76 countries around the world. We basically face all the market customers in the world that are interested in any mainstream products.”
“As for me, I was born in Shanghai, and I grew up in China, although I have been living abroad for 10 years, but my first job after graduation was in Shanghai, China, is a bank trader” said Mr Cheng to FinanceFeeds China.
“I was concerned about the development of China’s capital market, and wanted to actively participate in it. China’s capital market over the past 30 years has experienced a lot of ups and downs, and now these days has come to a very mature point. In the course of future development trends, we need to understand more, whether the regulatory framework should be perfected and become more meticulous. On the other hand, we need the attention of each market participant with regard to risk management, while at the same time thinking about whether we can achieve a more mature or perfect realm in terms of company operations. Because at present, China’s capital market is now moving towards the period of change, we in this period of change have to consider how we will pragmatically lead it” – Biyi Cheng, Head of Greater China, CMC Markets
Mr Cheng continued in his discussion with FinanceFeeds “For example, before the stock market problem, we did not really experience very much volatility, but despite this many customers experienced losses. After the changes that have taken place recently, how should we reflect? We should work out how to learn from it, to push us to a higher level, which is really the direction all participants in the Chinese market should take.”
“Now the Chinese regulators have to develop in this area, and I believe that after that, whether it is investor-driven or regulatory, market participants including securities companies, fund companies and electronic brokerages will go through some degree of evolution. It is worth keeping in mind that, at the same time that we are experiencing massive degrees of innovation, the past is still casting a shadow, but the right way forward is for companies in the market to take their part in the development direction of China’s capital market” – Biyi Cheng, Head of Greater China, CMC Markets.
“For CMC Markets in China, with regard to our strategic plan, I would like to say that we came to this market, with three points as the center: learning, communication, and development” said Mr Cheng.
“In the past 10 years, we became the first non-bank overseas financial institutions in Beijing in 2004, with official approval which resulted in the establishment of the Beijing office. Looking back at that time compared to now, it can be said that China’s investment environment has experienced vast changes but investors are also very mature. Investor preference for investment, risk appetite, and selection of varieties of asset class are all factors that have evolved, all of which we need to understand further. So we are approaching this with a learning mentality” said Mr Cheng.
“We as an overseas company operating in China, come to this market with 27 years of commercial expertise, and have also experienced a lot of ups and downs, but also have learned a lot of lessons” said Mr Cheng.
“We have grown up and yet are still growing, so we hope to impart our overseas experience within China, and become one of China’s top financial institutions in terms of communication, risk control, portfolio, and product technology. We also need to communicate with local institutions, through the exchange systems, making use of our local expertise and hope that through this, we can help and promote local institutions in this area rise to a higher level” said Mr Cheng.
FinanceFeeds China then spoke with Mr Lewis with regard to corporate culture. We at FinanceFeeds understand that CMC Markets attaches great importance to create a diversified corporate culture and train the backbone of the elite team in each region constantly. Bearing this in mind, We asked Mr Lewis to elaborate on the Chinese executive team, and which outstanding talent will serve the Chinese market.
Mr Lewis explained “Biyi Cheng is our Head of Greater China, and we have many years of cooperation together, hence he is very dedicated. A very important point is that he has a very strong financial trading background, and he will be able to better understand what customers need in the end, and can effectively help provide the Chinese market customers need the tools and services.”
“I think that for Greater China, the culture that we promote is very important. In our Chinese office, our core comprises Chinese staff with a professional industry-specific background” said Mr Lewis.
“As a result of their work in the Chinese office, this can help us better meet the needs of the Chinese market. As we have explained previously today, we provide a sophisticated trading platform and tools, and such a platform and tools must be combined with the local market, thus we must understand the characteristics of the local market, which then means that the way that we have built the Chinese team is a key consideration element” – Matthew Lewis, Head of APAC & AC, CMC Markets
“Currently, we have about 30% of our global staff located in the Australian office, but on the other hand, we are also increasing and accelerating our construction in China. Our office in China is located in Shanghai and we will continue to strengthen our staff recruitment and training, so that they better serve the Chinese market” concluded Mr Lewis.
Peter Cruddas, CEO of CMC Markets, explained to FinanceFeeds China “I would like to add that CMC Markets is a company listed in London and we will do what we need to provide the necessary support for our office in China.”
“We came here not to adventure and speculate, but based on our long-term research and understanding of the Chinese market, and our full understanding that this is a good time to further our business in China. If we had come with a speculative mentality, we would not be evolving in the right direction for the whole Chinese team. We are basing the building of our team on our understanding of the Chinese, hence we will build a very strong operational base in China, so that the Chinese market has a more accurate and better understanding of CMC Markets as a global benchmark” – Peter Cruddas, CEO and founder, CMC Markets.
Indeed, a very poignant moment for one of the most renowned household names in the business, and at a time during which China is the key focus for a vast proportion of the industry globally.