GAIN Capital’s earnings rise in Q1 2018, as retail and institutional volumes grow

Maria Nikolova

The company registered a net income of $16.1 million, compared to a loss of $18.9 million a year earlier.

Online trading major Gain Capital Holdings Inc (NYSE:GCAP) saw a solid first quarter of 2018, as has been demonstrated by the set of financial and operating metrics the broker has just posted.

After a challenging final quarter of 2017, the company managed to register a (GAAP) net income of $16.1 million in the first three months of 2018. This compares to a net loss of $18.9 million registered in the corresponding period in 2017.

Net revenue was also robust, staging a rise of 79.4% year-over-year and reaching $106.9 million.

The financial metrics reflected solid operating results. Retail average daily volumes increased 31% year-over-year to $12.4 billion in the first quarter of 2018, whereas institutional ECN average daily volume increased 26% year-over-year to a record high of $14.8 billion. The number of new direct accounts rose 24% from the equivalent period in 2017.

GAIN’s Chief Executive Officer Glenn Stevens called the quarter a strong one and highlighted the growth in revenues, as well as the margin expansion to 31%, as well as the robust overall operating metrics, especially within the retail business.

“A return to more normalized volatility levels provided a market environment in which GAIN was able to showcase the benefits of our investment in organic initiatives over the past year. Customer engagement was up across the board, with retail average daily volume up 31% year-over-year and Institutional ECN average daily volume up 26% to reach a record high of $14.8 billion”, he noted.

During the first quarter of 2018, GAIN focused on returning capital to shareholders through dividends, which amounted to approximately $2.6 million. The company repurchased 580,064 shares of stock at an average price of $7.20 and returned a total of $6.8 million to shareholders in the form of share repurchases and dividends.

GAIN’s Board of Directors declared a quarterly cash dividend of $0.06 per share of the company’s common stock. The dividend is payable on June 19, 2018 to shareholders of record as of the close of business on June 12, 2018.

Let’s note that GAIN is embracing AI. It started implementing a new AI-driven hedging model in late Q1 in order to reduce quarterly RPM. This has been rolled out for FX in March, with additional asset classes to follow.

The broker also provided an update on how its services develop. For instance, the new web platform is now in Beta, whereas GAIN plans to roll out an Android version of its GetGo mobile app in May 2018.

Read this next

Digital Assets

Ankr successfully patches hack, will reimburse victims and take actions to prevent further attacks

DeFi protocol Ankr plans to reimburse its affected users after a hacker managed to exploit a bug in its code that allowed for unlimited minting of its liquid staking token.

Industry News

ASIC cancels/suspends AFS license of AFSL Group and Quantum Funds Management

ASIC canceled the AFS license of AFSL Group because it failed to lodge statements and audit reports and it did not maintain AFCA membership. The Australian regulator suspended Quantum because it does not have the required professional indemnity insurance coverage.

Executive Moves

BidX Markets hires Shaun French as Research Analyst – Multi Asset

“We believe with his background in the Financial Markets and being based in Dubai, he will be able to provide our clients with access to outstanding research, while also being in a great location to help support our international clients base which is growing at a rapid pace’’.

Institutional FX

Nasdaq migrates US options exchange to AWS with +10% performance in round-trip latency

Nasdaq has announced the successful migration of the core trading system of Nasdaq MRX – one of its six U.S. options exchanges – to Amazon Web Services (AWS).

Institutional FX

TraditionData launches oil swaps pricing data at a critical time in OTC oil traded markets

TraditionDATA has announced the release of a new proprietary Oil Swap Model (OSM) which brings further visibility into illiquid and opaque oil markets.

Technology

TNS connects to Tel Aviv Stock Exchange (TASE) as market data vendor

“This latest exchange connection allows TNS to provide access to approved recipients, including exchange members and market data vendors. This project includes market data for TASE’s equities and increases the number of market data feeds we now offer globally.”

Executive Moves

Cowen Digital taps ex-Blockchain.com Taylor S. Cable to lead Europe and Asia operation

“Cowen Digital is a pioneer in delivering institutional grade access to the digital asset ecosystem and I am very excited to join the team at this pivotal time to grow our presence in Europe and Asia.”

Industry News

ASIC sues American Express Australia for lack of TMD on credit cards

“ASIC has now taken multiple actions under the design and distribution regime, including issuing over 20 interim stop orders. This regime turned a new page in the regulation of financial products in Australia and is intended to deliver better outcomes for consumers. It is a priority for ASIC to maximize these increased protections and see the long-term benefits of the DDO regime realized.”

Institutional FX

Eurex reports mixed volumes for November 2022

Deutsche Börse’s derivatives-focused exchange, Eurex today said its total traded derivatives contracts grew by 10 percent in November, from 68.6 million to 75.3 million compared to the same month last year.

<