GAIN Capital Generated a Profit on the Forex Industry's Black Thursday
- GAIN Capital is another brokerage which is reporting to have in place a solid risk management framework which prevented it from being materially impacted by the Swiss National Bank's decision.
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 Black Swan A Black Swan event is most commonly associated with an unforeseen calamity or event. In its most basic form, this event results in disastrous consequences for multiple parties, markets, or individuals and are characterized as extraordinarily rare in frequency, yet are seemingly predictable in retrospect. In the foreign exchange space, the most noteworthy of these events in recent memory was the Swiss National Bank (SNB) crisis which roiled currency markets back on January 15, 2015.During this in A Black Swan event is most commonly associated with an unforeseen calamity or event. In its most basic form, this event results in disastrous consequences for multiple parties, markets, or individuals and are characterized as extraordinarily rare in frequency, yet are seemingly predictable in retrospect. In the foreign exchange space, the most noteworthy of these events in recent memory was the Swiss National Bank (SNB) crisis which roiled currency markets back on January 15, 2015.During this in Read this Term 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."
"We remain focused on managing our risk, taking a conservative approach to managing our exposure to global currencies, while providing Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term 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.
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 Black Swan A Black Swan event is most commonly associated with an unforeseen calamity or event. In its most basic form, this event results in disastrous consequences for multiple parties, markets, or individuals and are characterized as extraordinarily rare in frequency, yet are seemingly predictable in retrospect. In the foreign exchange space, the most noteworthy of these events in recent memory was the Swiss National Bank (SNB) crisis which roiled currency markets back on January 15, 2015.During this in A Black Swan event is most commonly associated with an unforeseen calamity or event. In its most basic form, this event results in disastrous consequences for multiple parties, markets, or individuals and are characterized as extraordinarily rare in frequency, yet are seemingly predictable in retrospect. In the foreign exchange space, the most noteworthy of these events in recent memory was the Swiss National Bank (SNB) crisis which roiled currency markets back on January 15, 2015.During this in Read this Term 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."
"We remain focused on managing our risk, taking a conservative approach to managing our exposure to global currencies, while providing Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term 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.