Ben Richardson, CEO at SulNOx, confident they can cost-effectively decarbonise commercial shipping. Watch the video here.
My village used to have three pubs showing sky sports but in the last four months all three have handed their boxes back. Small pub being asked for £880 a month ! Slightly bigger one (but still not a big place) £930 p/m. Just mad. On a personal level my sports package finally got to the level where I had to say No and I know of several others who have turned off the feed recently. I realise that this is apocryphal but if my village is indicative of what is going on across the UK the numbers for Sky may be suffering.
My village used to have three pubs showing sky sports but in the last four months all three have handed their boxes back. Small pub being asked for £880 a month ! Slightly bigger one (but still not a big place) £930 p/m. Just mad. On a personal level my sports package finally got to the level where I had to say No and I know of several others who have turned off the feed recently. I realise that this is apocryphal but if my village is indicative of what is going on across the UK the numbers for Sky may be suffering.
I would say that a lot of commentators are 'shouting their mouths off' this morning on this stock. I am merely stating boring facts. There may be buying on Nex but it is not (yet) big enough to impact whatever sell order is sitting on the market. I repeat my comment from earlier... there is no statement about current trading conditions which is curious.
The problem here is the regulatory capital a year or so ago they had to turn the warrants into equity (releasing about £17m) but the last two years have an EBITDA loss of 4.7 and 12.5 (coincidentally about £17m). Presumably the loss for 2015 forced the premature exercise of the warrants. There is no comment on current trading either which is not encouraging and the FCA ruling on client margin is still to come.
whilst i have no particular insight as to whether IG share price ill rise or fall investors should be wary of this 'article' as it has quite a few materiel errors . The biggest of these was the statement that the FCA only has jurisdiction over products 'sold to UK customers' this is a factual falsity. The FCA rules apply to all business going through its UK entity (which is its head office and risk consolidations center) whether that business comes from the UK or from Timbuktu. Not only this, if IG attempted to move it's retail arm outside of the UK simply to avoid FCA rules then the FCA would take a very dim view of it. In such a scenario the company would risk sanction. Aside from this... the postulated move to Germany would only be 'good' if Germany was unlikely to change as well. Whilst the German regulators have seemed favorable in the short term it is a tough stretch to imagine that they would remain so in the face of French, Belgian, Dutch etc complaints. So the calculations should be made from the point of view that ALL revenue suffers in the same way as UK business. on this basis the current levels look 'reasonable' until 2017/18 gives better vision
there are only a few countries UK .. and... Gibraltar (unlikely to vary its rules much from the FCA's) Ireland does allow spread betting but it is not particularly fond of it. I don't think there is a single SB company based there now. Looks like IG has hit a low around the 450 level.
Commentators miss the point about spread betting. They cannot move the Spread betting unit to Germany because Spread Betting is not a recognised financial services product (for the same reason none of the FX units offers spread bets out of Cyprus). To offer SB's they had to get regulated approval in the UK. Spread Betting is tax free (because gambling is tax free int eh UK) which is one of its big selling points but Gambling is not tax free in Germany either. So 'sadly' IG and CMC cannot move their SB offering to another jurisdiction. They can move the cfd unit.
i think that you greatly over estimate the power of IG. From the FCA's point of view CFD/SB has always been a pea under the mattress... irritating and of only tiny significance. The FCA is not interested in taxation or profitability it is only interested in the rules. If IG and CMC left for easier climes the FSA would be happy as it would be one less problem for them to consider.
The comment that 38% of clients not being affected is not what is in IG's own account for 2016 which state that total segregated funds are £917m (all of whom WILL be affected by this decision) whilst own spare cash PLUS professional monies comes to £218m. Even if ALL of cash or cash equivalent funds belonged to clients (which would be very worrying) this would only be about 25%. In reality most of this cash will be IG's own money not their clients. So the total client business not impacted by this ruling will be around 10-20%. The Numis comment makes no reference to the new strictures on opening new accounts... which will have to contain a very severe risk warning .. way above what is in place now.
charlies for every client who uses the service for real hedging purposes (as you did) there are 100 who do not. In ten years of working in the industry I never came across a client who 'specifically' used our services for this reason (although there were always comment threads about it). And we had better spreads and cheaper rolling costs than IG. Your are right about bank costs for this service... they are well into the usury level
No .. FCA consultancy papers are always what they intend to do. Historically the FCA has never changed the core thrust of a ' consultation ' and the FCA has never really liked the retail derivative market place. They cannot apply rules to one set of companies that do not apply to all. By the way .. for all of IG's holier than though "providing the client with data, education etc etc" they make more per client than almost any other SB company. So, oddly enough, your line about "taking punters money and don't care less" applies more to them than to anyone else.
IG are slightly different to most of the SB companies in that a few years ago they stated that 50% of their revenue came from just 1% of their clients. But in those days clients could be designated as 'professional' or 'retail'. Now nearly all clients are designated as retail (and I believe that IG made a statement a while ago that they had designated all clients as retail) so the new margins will be attributable to all. IG makes a profit of around £2,400 per client, if I remember correctly, but the majority of clients (the 99%) will be in the £500 to £1000 bracket. The new rules will make this revenue stream harder to maintain. But more importantly ... If IG has to apportion the new margins to the 1% of heavy hitters then these clients may well move their business elsewhere. There are perfectly respectable cfd brokers in Turkey, Malta, Asia who will be more than pleased to pick up the business.
Hi sdoglyons The big spread betting companies do not 'prop trade' . I doubt if the small ones do either. And I have never heard of one actively taking positions. it is not a matter of 'hedging' per se. What happens is that every company has an ICAAP that must be reported to the FCA. Within the ICAAP is a calculation that defines the amount of market risk the company can take. This used to be called the PRR (position risk requirement) but I am not sure if this is still the case. This PRR is based on the capital available to the company. Until this PRR limit is reached the SB company will do nothing and then will hedge everything above it. In practice the PRR was split amongst the various asset classes (Indices, FX, Commodities, Equities). So it not a matter of hedging 50%..60% or 0% it is a matter of DOING NOTHING AT ALL except keeping the overall book risk below the PRR. You are correct about the FCA driving out the small player in the UK. I cannot see how they can operate under the new rules. BUT the real problem is that you will still be able to open accounts with non-FCA/Mifid companies across the globe who will still be able to offer the old margins. Not only this but they will be perfectly entitled to advertise online or on Bloomberg/CNBC as they will be abiding by their own local regulatory rules. So instead of money coming into the UK from across the world the reverse will now start to happen,
I am sorry to annoy everyone again but I actually worked (really) for one of the big spread betting companies. So I know rather more about where the revenue comes from than others on this thread. It might be noticeable that there is no leap into buying from the senior management (director buying). Mattthebrave might deride my version of margin but that is how the industry looks at it... we look at the minimum funds required to place a bet. As of now on IG you can place a £1 bet on the EUR/USD with £54 quid in your account. When the FCA rules come in a beginner (i.e. the majority of new accounts) will require £428 for the same risk. i.e 8 times more money. Whilst a few clients may deposit more cash the reality is that a) fewer people will bother b) those that do bother will trade in sizes far less than they did before. Spread betting/cfd companies make money because clients run their losses and take their profits ... in the end the average client just gets into a position that starts losing .. they do not cut it.. and it eventually wipes out their trading resources. This is unlikely to change for the majority BUT it will take far, far longer for each client to actually lose AND the chances are that with the increased margins that a larger number of clients will actually start to win as they will have enough margin to support losing positions... giving the market time to turn in their favour. People are also ignoring the fact the FCA wants a prominent risk warning placed on the site and in the application process (like Cigarette packets) stating that 82% of clients lose money . What do you think that will do to the applicant numbers? This is a very, very bad initiative from the FCA . I am not short and never will be but if investors think 40% fall is overdone I think they should think again
No Matter what some commentators are saying here about a bounce the fact is that the move by the FCA is a very material change. Clients will have to assign far greater margin to trades which will reduce trade sizes massively. In reality most markets do not actually move that much and clients lose money on quite small price movements. A beginner having to place 4% margin on a position will not be forced out of their trade except in quite large directional moves. As an example the FTSE 100 (one of the most popular markets) has traded in a 5 to 6% range since July. (effectively between 6650 and 7050). What forces clients out of positions is that they commit too little margin to support those positions. But if they are forced to put up 4% this will massively increase the likelihood of a position coming back to a profit whilst not increasing the total potential profit of IG by one penny. In the above example of the FTSE 100 only those who had sold near the bottom or bought near the top would have been forced out whilst the market has bounced around about six times allowing loss making positions to recoup into profit. People saying that this will have no impact are not clued up on how SB/CFD companies make their money.
Whilst IG has business across the globe it is "Regulated" by the FCA. The FCA would not be happy if they attempted to circumnavigate this instruction via alternate jurisdictions. In any case the other centers that they are authorised in (Singapore, Australia etc) either already have these margin restrictions OR are very likely to follow the FCA's move.