Professional traders flock to IG Group

Maria Nikolova

IG Group has received around 15,000 applications since November 2017 from clients to elect to be categorised as professional, and 3,800 clients are now categorised as professional.

Electronic trading major IG Group Holdings plc (LON:IGG) has registered a strong inflow of professional client applications, according to a trading update the Group posted earlier today.

IG says it has continued to perform well in the final quarter of FY18, with net trading revenue for the full year forecast to be around £565m (FY17: £491m).

The Group expects the product intervention measures announced by ESMA in March 2018 to come into effect in the first half of FY19. As previously guided, IG believes that the reduction in historic revenue from the implementation of the measures announced by ESMA, taking into account the expected proportion of revenue that will be generated from clients categorised as professional, would have been approximately 10%. The company expects to return to growth after FY19.

Regarding professional clients, the IG says it has received around 15,000 applications since November 2017 from clients to elect to be categorised as professional, and 3,800 clients are now categorised as professional. The Group’s process for assessing these applications is appropriately rigorous and over three-quarters of the applicants to date have been rejected.

Clients categorised as professional contributed over 35% of UK and EU OTC leveraged revenue in the last three months, and the Group continues to expect this proportion to rise to 50% when the ESMA measures come into effect.

There are a number of actions that retail clients may take in response to the ESMA measures, IG says. The Group will allow appropriate retail clients to continue to trade as they choose where this is fully compliant with the regulatory rules.

IG believes that macro trends will continue to fuel business growth. The business expects to benefit from its US subsidiary serving the OTC FX market, which is set to go live by the end of the first half of FY19, from the MTF in Europe that is expected to be live for FY20, and from acquiring licences to operate in jurisdictions in selected emerging markets that fit IG’s criteria.

IG also notes the recent action by large technology firms on inappropriate advertising and marketing, and on unlicensed operators in the industry. These actions include introducing bans on the advertising and marketing of cryptocurrencies and binary options, and the requirement that firms advertising and marketing CFDs can demonstrate that they are appropriately licensed in those jurisdictions in which the services are being promoted. IG also expects that some of the large payment and card providers will soon introduce rules to ensure that these businesses only facilitate payments from and to clients in jurisdictions in which the firms are appropriately licensed.

IG does not anticipate that the actions currently being taken, if applied appropriately, will have any significant impact on its business.

Read this next

Retail FX

Financial Commission adds Ultima Markets to membership roster

Multi-asset brokerage firm Ultima Markets, operating under the trading name Ultima Markets Ltd, has been granted membership of the Financial Commission, marking the most recent inclusion into the ranks of the self-regulatory organization.

Digital Assets

Bitcoin hits fresh record high amid massive short squeeze

Bitcoin has surged to record highs against both the euro and the pound, hitting €60,447 and £51,736 respectively on Coinbase. The primary cryptocurrency has seen an almost 7% increase in the past 24 hours.

Digital Assets

US court rules crypto trades as securities in Coinbase case

A US court ruled that trading crypto assets on platforms like Coinbase constitutes securities transactions.

Market News

Weekly Data: Oil and Gold: Brief Review before the NFP

This preview of weekly data looks at USOIL and XAUUSD where economic data coming up later this week are the main market drivers for the near short-term outlook.

Institutional FX

FXSpotStream reports lower volumes for February 2024

FXSpotStream’s trading venue, the aggregator service of LiquidityMatch LLC, reported its operational metrics for February 2024, which moved lower on a monthly basis.

Fundamental Analysis

Global FX Market Summary: EUR, USD, Gold March 4th,2024

US Dollar Weakness: The US Dollar (USD) is currently struggling to gain strength due to a combination of factors.

Technical Analysis

Bitcoin Technical Analysis Report 4 March, 2024

Bitcoin cryptocurrency can be expected to rise further toward the next resistance level 69000.00 (former multiyear high from January)


Finding Opportunity in Challenge: Why New Regulations Offer a Chance For Business to Get on Top of Data Management

The combination of CESOP, PSD3 and the PSR, has put businesses under new pressures. In this engaging article, André Casterman, Senior Advisor at Intix provides invaluable guidance on how companies can stay ahead of the curve.

Institutional FX

Finalto launches Prime of Prime offering on LSEG’s FX Matching venue

“By combining our expertise in Prime of Prime services with LSEG’s robust trading platform, we aim to empower clients with the tools and resources needed to navigate the FX market with confidence.”