CMC Markets Expects FY 2021 Net Operating Income to Exceed Forecasts

The consistently strong trading performance across CMC Markets has continued, according to a trading update from the online trading and institutional platform technology solutions provider today.

As 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 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 Read this Term driven by the Coronavirus Coronavirus The outbreak of Covid-19 or Coronavirus in early 2020 has since redefined the financial services industry. Brokers have been forced to quickly adapt to several changes, both positive and negative.This includes the FX industry, which saw surges in volumes across the retail and institutional space in Q1 2020. This trend can be explained by an outflow of volatility, coupled with countries taking major moves to stabilize their respective economies.In conjunction with uncertainty caused by the virus, The outbreak of Covid-19 or Coronavirus in early 2020 has since redefined the financial services industry. Brokers have been forced to quickly adapt to several changes, both positive and negative.This includes the FX industry, which saw surges in volumes across the retail and institutional space in Q1 2020. This trend can be explained by an outflow of volatility, coupled with countries taking major moves to stabilize their respective economies.In conjunction with uncertainty caused by the virus, Read this Term pandemic continues to lessen and brokers across the world publish lacklustre trading volumes in both July and August, CMC Markets said that it continued to see a strong trading performance from 1st July 2020 until 31st August.

According to the trading update today, net operating income run rate for the two month period has come in only slightly below the first quarter of its 2021 fiscal year. Furthermore, client income has continued to be in excess of the same period in the prior year.

Net Operating Income for CMC Markets to Exceed Forecasts

In the trading update, the UK-based company highlighted that client income retention has remained particularly strong and that it is well in excess of the guidance of above 80 per cent. The company’s stockbroking business has also continued to perform strongly, the company said.

“As a result, the Board is confident that with the strong underlying performance and diversity of the business, FY 2021 net operating income will exceed the upper end of current market consensus,” CMC Markets said in the trading update.

As outlined by the brokerage, the higher revenue performance since the beginning of the financial year has been driven by existing clients increasing their trading activity, as well as new traders flocking to CMC Market’s platform.

As Finance Magnatesreported, with COVID-19 bringing heightened volatility to the trading markets, a wave of new traders have entered into the markets, many of them being first-time traders.

The influx of new clients has also resulted in an increase in CMC’s variable operating costs, largely driven by higher client onboarding costs. In order to keep its new clients, as well as attract new users, the CMC Markets Group will continue to focus on investing in its technology.