IG Group Holdings plc (LON: IGG) on Wednesday reported a 13 percent jump in its revenue between December and February, which is the third quarter of the financial year for the company. The broker generated £257.2 million in the three months.
IG highlighted that the comparative period was very challenging as Q3 FY21 witnessed an “extraordinary ‘meme stock’ related volatility
Volatility
In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders can be successful in both low and high volatile environments, but the strategies employed are often different depending upon volatility. Why Too Much Volatility is a ProblemIn the FX space, lower volatile currency pairs offer less surprises, and are suited to position traders.High volatile pairs are attractive for many day traders, due to quick and strong movements, offering the potential for higher profits, although the risk associated with such volatile pairs are many. Overall, a look at previous volatility tells us how likely price will fluctuate in the future, although it has nothing to do with direction.All a trader can gather from this is the understanding that the probability of a volatile pair to increase or decrease an X amount in a Y period of time, is more than the probability of a non-volatile pair. Another important factor is, volatility can and does change over time, and there can be periods when even highly volatile instruments show signs of flatness, with price not really making headway in either direction. Too little volatility is just as problematic for markets as too much, we uncertainty in excess can create panic and problems of liquidity. This was evident during Black Swan events or other crisis that have historically roiled currency and equity markets.
In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders can be successful in both low and high volatile environments, but the strategies employed are often different depending upon volatility. Why Too Much Volatility is a ProblemIn the FX space, lower volatile currency pairs offer less surprises, and are suited to position traders.High volatile pairs are attractive for many day traders, due to quick and strong movements, offering the potential for higher profits, although the risk associated with such volatile pairs are many. Overall, a look at previous volatility tells us how likely price will fluctuate in the future, although it has nothing to do with direction.All a trader can gather from this is the understanding that the probability of a volatile pair to increase or decrease an X amount in a Y period of time, is more than the probability of a non-volatile pair. Another important factor is, volatility can and does change over time, and there can be periods when even highly volatile instruments show signs of flatness, with price not really making headway in either direction. Too little volatility is just as problematic for markets as too much, we uncertainty in excess can create panic and problems of liquidity. This was evident during Black Swan events or other crisis that have historically roiled currency and equity markets.
Read this Term.”
Out of the total, £219.3 came from IG’s over-the-counter (OTC) leveraged derivatives business, which jumped by 4 percent from the same quarter of the prior year. However, stock trading and investment revenue dropped by 54 percent to £6.6 million.
The largest revenue driver was the platform’s exchange-traded derivatives. It brought in £31.3 million in the reported three months from a negligible figure of £1.9 million in Q3 FY21. It also factored in the revenue from tastytrade that generated £28.4 million in the quarter.
“I’m delighted to be reporting another quarter of outstanding performance driven by a record number of clients trading in the period,” said IG Group’s CEO, June Felix.
Record Number of Clients
The client figures of the broker also came in to be very impressive. The number of quarterly active clients came in to be 292,200, compared to Q3 FY21’s 220,900.
“Today, we have more clients and a broader range of products to trade than ever before in our history. But we aren’t stopping here – a new IG is emerging, and we’re excited by the opportunities ahead of us, building on our strengths and track record of delivery,” Felix added.
The broker further said that it is now expecting FY22 revenue to moderately exceed current market expectations. However, for tastytrade, revenue growth may remain below the previously guided 25 percent to 30 percent range for FY22 due to slower growth in US options trading volumes in the recent quarters.
IG Group Holdings plc (LON: IGG) on Wednesday reported a 13 percent jump in its revenue between December and February, which is the third quarter of the financial year for the company. The broker generated £257.2 million in the three months.
IG highlighted that the comparative period was very challenging as Q3 FY21 witnessed an “extraordinary ‘meme stock’ related volatility
Volatility
In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders can be successful in both low and high volatile environments, but the strategies employed are often different depending upon volatility. Why Too Much Volatility is a ProblemIn the FX space, lower volatile currency pairs offer less surprises, and are suited to position traders.High volatile pairs are attractive for many day traders, due to quick and strong movements, offering the potential for higher profits, although the risk associated with such volatile pairs are many. Overall, a look at previous volatility tells us how likely price will fluctuate in the future, although it has nothing to do with direction.All a trader can gather from this is the understanding that the probability of a volatile pair to increase or decrease an X amount in a Y period of time, is more than the probability of a non-volatile pair. Another important factor is, volatility can and does change over time, and there can be periods when even highly volatile instruments show signs of flatness, with price not really making headway in either direction. Too little volatility is just as problematic for markets as too much, we uncertainty in excess can create panic and problems of liquidity. This was evident during Black Swan events or other crisis that have historically roiled currency and equity markets.
In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders can be successful in both low and high volatile environments, but the strategies employed are often different depending upon volatility. Why Too Much Volatility is a ProblemIn the FX space, lower volatile currency pairs offer less surprises, and are suited to position traders.High volatile pairs are attractive for many day traders, due to quick and strong movements, offering the potential for higher profits, although the risk associated with such volatile pairs are many. Overall, a look at previous volatility tells us how likely price will fluctuate in the future, although it has nothing to do with direction.All a trader can gather from this is the understanding that the probability of a volatile pair to increase or decrease an X amount in a Y period of time, is more than the probability of a non-volatile pair. Another important factor is, volatility can and does change over time, and there can be periods when even highly volatile instruments show signs of flatness, with price not really making headway in either direction. Too little volatility is just as problematic for markets as too much, we uncertainty in excess can create panic and problems of liquidity. This was evident during Black Swan events or other crisis that have historically roiled currency and equity markets.
Read this Term.”
Out of the total, £219.3 came from IG’s over-the-counter (OTC) leveraged derivatives business, which jumped by 4 percent from the same quarter of the prior year. However, stock trading and investment revenue dropped by 54 percent to £6.6 million.
The largest revenue driver was the platform’s exchange-traded derivatives. It brought in £31.3 million in the reported three months from a negligible figure of £1.9 million in Q3 FY21. It also factored in the revenue from tastytrade that generated £28.4 million in the quarter.
“I’m delighted to be reporting another quarter of outstanding performance driven by a record number of clients trading in the period,” said IG Group’s CEO, June Felix.
Record Number of Clients
The client figures of the broker also came in to be very impressive. The number of quarterly active clients came in to be 292,200, compared to Q3 FY21’s 220,900.
“Today, we have more clients and a broader range of products to trade than ever before in our history. But we aren’t stopping here – a new IG is emerging, and we’re excited by the opportunities ahead of us, building on our strengths and track record of delivery,” Felix added.
The broker further said that it is now expecting FY22 revenue to moderately exceed current market expectations. However, for tastytrade, revenue growth may remain below the previously guided 25 percent to 30 percent range for FY22 due to slower growth in US options trading volumes in the recent quarters.
Source: https://www.financemagnates.com/forex/brokers/ig-groups-q3-fy22-revenue-jumps-13-active-clients-hit-record/