Lucid Markets Profit Down on Weak Revenues for 2016

The company highlighted that it is actively being marketed for sale in 2017.

FCA-regulated Lucid Markets, a non-bank market maker and trader in the institutional FX market, has released its financial results for the full year ending December 31, 2016, which featured a notable decline across a number of key metrics, ranging from profit to revenues, according to its earnings filing with the UK Companies House.

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In terms of the aggregated financial results by the end of FY 2016, Lucid Markets put together a weak YoY performance relative to 2015 figures.

For 2016, Lucid Markets saw a gross profit of $12 million which represented a decline of -43 percent year-over-year from $21.2 million in the year ending December 31, 2015. In addition, Lucid’s operating revenues also pale in comparison to last year’s figures, underscoring a sizable drop of -29 percent year-over-year or $10.9 million, after it was reported at $26.3 million compared to $37.2 million a year earlier.

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Looking at the rest of the filing, Lucid Markets noted that it constantly reviews its operating strategies, which may be modified to include adding new trading instruments from time to time.

The company also highlighted that it is actively being marketed for sale in 2017 in the context of FXCM Group’s plans to dispose of interests in certain retail and institutional businesses, which commenced back in 2015 following the SNB’s black swan event.

Lucid Markets is 50.1 percent owned by FXCM UK Merger Limited, which in turn is 100 percent owned by FXCM Group, LLC. Global Brokerage, Inc. formerly known as FXCM Inc., is the ultimate controlling undertaking that operates and controls all of the group’s businesses and subsidiaries.

U.K.-based Lucid Markets has seen a stellar rise in its status in the traditionally bank-dominated field of price-making. Lucid was founded in 2009 by Matthew Wilhelm, the former head of FX algorithmic trading at Goldman Sachs, and Dierk Reuter, the former head of FX algorithmic trading at Deutsche Bank, to operate as a specialist high-frequency trading firm, and has built out a market-making business to institutional clients since then.

Traditionally, only the largest funds and institutions have been able to get access to the benefits provided by the non-bank market makers. This is because access has relied on the client having a tier one prime broker relationship.

High-frequency trading firms, such as Lucid, now offer their liquidity stream to a select range of FX clients, such as retail brokers, as an alternative form of liquidity to the banks.

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