Plus500, a London listed company that makes it possible for customers to trade contracts for difference on over 2,200 financial instruments said that despite the regulatory changes, they are well placed to ride out the volatility in financial markets.
FCA Crackdown
In December, the Financial Conduct Authority (FCA) said that they planned a crackdown on contracts for difference (CFD) products which saw shares in Plus500 and their rivals fall from around 600p to 340p.
In an effort to appease the watchdog, Plus500 and other spread betting firms drew up a code of conduct to deal with regulatory pressures.
Today following their announcement Plus500, who sponsors Spanish football giant Atletico Madrid, shares jumped 3 percent on Tuesday, after an initial jump in early trading of 5 percent.
High Value Customers
CEO of Plus500, Asaf Elimelech said that they have been focusing on high value customers, who have been supported by the innovative technological edge that Plus500 offers.
In spite of the regulatory changes, the results for the third quarter is showing trading activity levels which are satisfactory. Across asset classes since September they have seen a return of higher volatility that will boost trading till the end of the year, leaving them optimistic.
This is due to the flexible business model and lean cost structure that Plus500 has put in place to help migrate the impact of the regulatory changes.
Plus500 a Leader
He believes that Plus500 will be amongst the leaders and that the market will consolidate into a smaller number with larger participants.
For the third quarter they saw a rise of eight per cent in customers using the platform to 102,043. There was a fall of 51 percent of new customers which totalled 20,684.
84% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money
