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Cantillon bought on Friday last week. So your comment is incorrect.
In reality this move by the FCA will have three effects. Remove competition Drive business out of regulated companies to unregulated shores Reduce business massively. The first one is good for IG (and the other big players) but bad for clients The second is a problem for regulated companies (and again bad for clients) but seemingly of no concern to our beloved FCA The third is definitely bad for IG . Revenue at spread betting/cfd companies have long been a function of spread revenue .... i.e. over an entire year a company can expect client revenue to be the spread times the stake size. With clients now being asked to put four (smallest increase) up to over 16 times (highest increase in margin) more cash up to place a bet this may reduce IG's revenue significantly ..... potentially by almost 70% Do not get too aggressive buying as the share price could potentially fall much more
middle east money Spread Bets are cfds .. Retail spread betting, fx and cfd trading are all designated as CFDs by the FCA As such this move by the FCA encompasses most of IG's trading revenue
Matt we are at cross purposes I am talking about the 'stake/bet' you are talking about the 'funds on deposit' So leverage on the funds on deposit is (as you say) 50 (or 25) times your cash. But my point was based on the bet size (which is how most people trade). The worry for IG here is whether the FCA will force companies to apply 50 times at all times. For instance if a client has £500 quid in his account and makes a trade using all of his resources will the SB/CFD company have to close the client out as soon as the margin available (minus p/l) goes below the minimum magin level ? At the moment positions are held until pretty much all the funds are lost.
It is not banned in the US Spread Betting is banned because it is betting and in the US cross border betting is not allowed but margined FX is huge over there. Also the US is much bigger into leveraged buying of equity (shares) than is the case over here. With stock brokers in the UK the norm is for zero margin on share sales. This is certainly not 'the norm' in the US.
sorry matt you do not understand margin/leverage a 50 margin means 2% of the underlying instrument (100/50). So for a £1 bet in gbp/usd (if the cross was at 1.2750) would require 12750/50 x 1 or £255 pounds .. just for a £1 bet ! On leverage of 25 (which the FCA wants for beginners) it would require £510 for a £1 bet.
The FCA move to limit margin to 50 times is a real game changer. Clients will have to put up 250 quid for just a £1 bet in something like Sterling/Dollar (as opposed to the normal 200 times on IG requiring just £70) For new clients it is even worse as they will have to put up £500 just for a £1 bet. How many retail clients are going to bother? It is estimated that it costs around 900 to get a new client but that client on average loses 2,200 a year. So the costs will be made up in just 5 months. With the new margins the costs may take 4/5 times longer to recoup (on average)
which twitter feed is this ?
even fewer buyers !
While the net numbers do not look that good it is interesting to see that 'revenue' for the second half of 2015 increased from around £5m to nearly £10m This did not create a profit but there were a number of one off costs in H2 that will not be repeated. The sales trajectory coupled with falling costs may well surprise for H1 2016 But, I am long and so might be falling into the trap of talking my book..
not exactly helped by the CEO (having lost £9m in six months) then goes out and buys himself a company car... A Bugatti
My affiliates work in the energy sector and for some considerable time it has been next to impossible to arrange FX or bank transfers involving the Ukrainian currency/banks. This is of materiel impact when you realise that they sell their product in the world market (for dollars) but have to pay their staff in ukrainian hryvnia and transact via ukrainian institutions. European Banks are wary of financial transactions (for the very reasons seen here) Normally this type of problem is a good thing when dealing with a falling currency but only if you can arrange the conversion at all !
RNS is almost modest. The numbers make for interesting reading as well over a third of the revenue was made in the last qtr. I hear that costs/staff have been slashed (these redundancy costs will have hit the 3rd qtr numbers) so the numbers for 2015 might be spectacular. The company has £32m of cash (including monies due from brokers) and no debt . At a capitalisation of only circa £25m it looks a very good bet.
even greater reason to have a little punt and buy a stake
michelboo apologies i was reading an article that started with the line "shares do not usually fall this far even after a profit warning" and made the wrong connection. I agree the Questor article is a little unbalanced as it is tarring OPAY with the same brush as QPP. QPP stated the EFH deal as a director Buy (!?) in their RNS which is a country mile away from how OPAY dealt with it.
On this stock with profit warnings, Questor sell recommendation and the Sherriff making his customary stab one would have thought that the shares should have fallen and then fallen again. Massively more sell than buy executions and still the stock did not fall. This looks a good spot to make a tentative dip of the toe. Not too much but worth a punt. Any price below 300 looks to have big support. There is a chance of a bear squeeze.
Interesting. I see that the company has bought 10.1m of the stock ( almost 20% ) and put it into its staff bonus pool. Also the new CEO has quietly bought 1.6m himself. Shares do not seem to have moved at all on this.