GAIN Capital Holdings has issued an additional statement expanding on the announcement made yesterday that it wasn’t materially impacted by the Swiss franc cataclysm.
The company’s statement reveals that it actually generated a profit for the day. Its risk management infrastructure and the increased leverage on the pairs involving the CHF in September have mitigated the impact of the black swan event and increased trading activity led to the most active trading day in weeks.
The company’s CEO Glenn Stevens stated, “Our strong risk-management framework allowed us to generate a profit on one of the most turbulent days for the global currency markets in recent years.”
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“We remain focused on managing our risk, taking a conservative approach to managing our exposure to global currencies, while providing liquidity and high-quality execution to our global client base,” he added.
“Events such as the SNB announcement, although unexpected, can be mitigated in their impact using a comprehensive, consistent approach to risk management, a focus on maintaining robust, scalable trading technology and vigilantly focusing on our customers. We have positioned ourselves to effectively manage risk during both calm and tumultuous markets and our performance during this recent event shows that,” concluded Mr. Stevens.
GAIN Capital increased its margin requirements relating to EUR/CHF to 5% back in September 2014, permitting the company in order to mitigate negative client equity risks in the event that the Swiss National Bank’s peg would breakdown.
“Following the events of January 15, 2015, we remain well capitalized, financially sound and well positioned to grow market share and, as one of the industry’s leading consolidators, take advantage of the strategic acquisition opportunities that will result from yesterday’s events. Our market-leading product offering and client execution means we are well placed to meet demand for online trading in foreign exchange, CFDs and other products,” Mr. Stevens concluded in the company announcement.