A regulatory filing made by IG Group reveals that the new CEO of the company, June Felix purchased 17,000 shares on January 23. The news got released after the market close in London, where the broker’s shares closed 1.3 percent higher on the day.
The average purchase price of the shares purchased by Felix was £5.85. The current price is around £6.20, putting the investment in the green less than a week after the initial purchase.
Felix spent a total of almost £100,000 on the purchase. Insider buying typically is associated with a positive outlook. It is aimed at reassuring investors about the confidence of the leaders of the company about the future direction of a company.
in is the second time Felix is buying shares in the company. With another 17,000 shares purchased in October, albeit at a higher level, the confidence of the most senior executive at the firm is reassuring.
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A Turnaround for the Industry?
With the first signs of a bottoming out in shares of major retail brokerage companies with significant operations in the EU, the industry itself could be at a turnaround point.
After the FCA announced in December 2018, that the temporary measures against leverage in Europe implemented in August 2018, are to remain permanent, the industry accepted the new status quo. From what senior executives at brokerages across Europe have been sharing in recent weeks, so have the clients.
While adamant at first, clients have been putting up more collateral to trade with their retail broker. The initial shock from the new measures didn’t stop the majority of clients from continuing to invest into their trading accounts.
The acquisition of new clients remains the most difficult part with the new marketing requirements certainly having an effect. That said, the regional diversification efforts which brokers have undertaken are starting to pay off too.
The offshore subsidiaries of firms working in the EU have been picking up steam. Despite difficulties with account funding, brokers appear to be able to diversify their business well enough.