FCA-regulated broker Finotec Trading UK Limited (FTUK) is hopeful about its performance in 2017 with a number of factors pointing to an optimistic projection.
The company notes that the SNB crisis left many traders, hedge funds, even small banks and brokers in ruins. Although Finotec was successful in keeping its liquidity providers’ pricing and closed out positions as necessary with no loss to its own financial integrity, it explains that much of the market that Finotec depends on did not, resulting in a slow and unyielding year as the market slowly recovered.
Finotec says that, having previously realized that its full earning potential shares a strong correlation with its clients’ continued success, it has already set in motion a business plan that would reduce its core dependency on trade volume as its main driver for turnover. Instead, it would promote a host of new innovative services, guaranteeing new choices for prospective clients. “These new services were born of 2015 but only took first breath in 2016, and are set to see their first growth spurt into 2017.”
Finotec has been keen to advertise its standpoint regarding competitive and transparent trading conditions, which it believes are the basis for encouraging a strong sentiment of success from its partners. For this reason, these values take center stage in Finotec’s new business model and are especially relevant in conjunction with its new Trade Name package, which is aimed at new and existing startup brokers that target FX and stock traders.
While 2016 certainly could have seen more growth, much of the initial setup and development, crucial in providing Finotec’s Trade Name partners with a simple, fluid and cost effective ecosystem, is now in place and already boasts 8 early adopters, 5 of which are already generating income from their clientele. With the damage caused by the SNB crisis still lingering in either the books or memories of many brokers so adversely affected by it, Finotec was profitable during 2016 and has successfully clawed back all 2015 losses resulting from the SNB backlash. With the imminent release of Finotec’s new Risk Management Solution, set to take existing and would-be B-Book brokers by storm, combined with Finotec’s FCA Regulated Umbrella packages, the company says 2017 is looking extremely promising.
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Back in September 2016 the company reported its financial metrics for the fiscal year 2015. In terms of the aggregated financial results by the end of 2015, Finotec put together a weak YoY performance relative to 2014.
Finotec followed up on a 2014 profit of £19,186 ($23,462) with a £157,689 ($192,834) loss for 2015, having been forced to revalue its net assets to £211,326 ($258,423) compared to £369,015 ($451,255 ) in the period a year earlier.
According to a regulatory filing, FTUK has been busy building a full brokerage suite of products and services so that it can confidently offer a unique one-stop-shop solution to new retail and prime of prime brokers.
Meanwhile, operating revenues at Finotec amounted to £1,092,979 ($1,336,823) in 2015, down 25.0 percent from a reading of £1,450,833 ($1,774,975) registered in 2014. In terms of administrative expenses, the comparison was not so rosy either, as the 2015 figure reflected an increase of 11 percent YoY, coming in at £839,352 ($1,027,346) compared with £756,499 ($925,936) from the same period in 2014. Accordingly, the loss for the year, after taxation, amounted to nearly £158,000.
In terms of client deposits, Finotec saw total client capital at $2.1 million in 2015, which represents a notable decrease of 38% YoY from $3.3 million in 2014. The company attributed the drop into its clients’ funds to the SNB CHF crisis that saw massive losses and reduced client margin holdings across the market.