IG Markets, one of the leading global providers of CFD trading has witnessed its busiest month ever as far as transaction numbers and revenue go according to a press release from the company. In particular the persistent market volatility during last month has led to a surge in account openings and trading volumes.
The stock markets experienced something of a roller coaster ride in August, with the Dow Jones, the FTSE 100 and the Australia ASX 200 indices trading in ranges of almost 2000 points, over 1000 points and nearly 800 points respectively. August was also the month that saw the USA debt ceiling increase to USD14.3 trillion and S&P’s downgrade USA credit from AAA to AA+. Across the Atlantic, there was continuing concern about the European sovereign-debt crisis.
Mr Tamas Szabo, Head of IG Markets Asia Pacific, noted that in August they experienced some of their busiest days ever and the market volatility has helped to encourage more clients to sign up. David Jones, IG’s chief market strategist in London had similar words to say ‘August saw the FTSE 100 move in a range of more than 100 points on 18 out of the 22 trading days – something that in more normal market conditions would only happen three or four times a month. As a direct result of the volatility, the number of orders placed by clients jumped significantly’.
‘In a typical month, IG’s 130,000 global clients execute over 5 million deals a month. On August 9 alone, our trading platform processed almost 900,000 transactions. We are also very happy by the performance of our award-winning trading platform, PureDeal, under this extreme load.’
In its first quarter trading update ended August 31st, IG Group revealed a 26% rise in revenues to £99.8m up more than £5m on the amount predicted in its August trading update, following the record trading month as a result of the heightened levels of market volatility. Excluding the company’s discontinued Extrabet business which was closed during the period, IG stated that like-for-like revenues were up 30% from £79.1m to £99.8m, on the back of a 20% increase in active clients and an 8% rise in revenue per client. Revenues from IG’s UK operations expanded by 22% to £51.8m, while Australian revenues grew by 51% to £17.0m. In Europe, IG registered revenue growth of 51% to £19.2m following strong trading in Germany (64%), Italy (59%), Spain (39%) and France (33%). Revenues from IG Group’s Japanese division however fell 32% to £4.4m due to the introduction of additional leverage restrictions since August 2010. Revenues from the rest of the world (including Singapore, the USA and South Africa) soared 79% to £7.2m, with revenues from Singapore up by 65%.
‘The Group continues to see progressive growth in active client numbers in all of the markets in which it operates, which is the key driver of the long term revenue growth in the business,’ said IG Group in a trading update to the London Stock Exchange this morning. ‘This growth is in turn underpinned by the on-going significant investment the Group makes in its technology platforms and systems.’
In a report by Investment Trends earlier this year, IG Markets scored high marks for overall customer satisfaction among CFD traders. The survey of nearly 8,000 investors, also revealed that IG Markets received the highest scores in the CFD industry for value for money, spreads, margin requirements, easy-to-use platform, charting, efficiency of taking trades, email and telephone customer service, reporting of positions and transactions, and phone trading.
