2019 has been a year of transition for many brokers. Finance Magnates spoke with Sara Ahmadi - Director of Operations at CMS Prime for her in-depth perspective on the company and its upcoming developments.

How does CMS Prime’s instrument offering stand out in a crowded field of brokers?

CMS Prime is always ahead of the broader competition by offering its clients the best services suite. We always stress on client experience and education and these are two pillars of our operations that we look to foster when running our business.

We always put the needs of our clients first and this is reflective in the wide range of trading instruments available to choose from. Other brokers have been scaling back instruments in light of new regulations, while CMS Prime is expanding them.

This includes our CFDs trading portfolio, which exceeds many other offerings in the retail industry. This is particularly relevant at a time when other jurisdictions are reducing CFDs’ availability.

How does market  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 can be successful in both low and high volatile environments, but the strategies employed are often different depending upon volatility. Why Too Much Volatility is a ProblemIn the FX space, lower volatile currency pairs offer less surprises, and are suited to position traders.High volatile pairs are attractive for many day traders, due to quick and strong movements, offering the potential for higher profits, although the risk associated with such volatile pairs are many. Overall, a look at previous volatility tells us how likely price will fluctuate in the future, although it has nothing to do with direction.All a trader can gather from this is the understanding that the probability of a volatile pair to increase or decrease an X amount in a Y period of time, is more than the probability of a non-volatile pair. Another important factor is, volatility can and does change over time, and there can be periods when even highly volatile instruments show signs of flatness, with price not really making headway in either direction. Too little volatility is just as problematic for markets as too much, we uncertainty in excess can create panic and problems of liquidity. This was evident during Black Swan events or other crisis that have historically roiled currency and equity markets. 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 can be successful in both low and high volatile environments, but the strategies employed are often different depending upon volatility. Why Too Much Volatility is a ProblemIn the FX space, lower volatile currency pairs offer less surprises, and are suited to position traders.High volatile pairs are attractive for many day traders, due to quick and strong movements, offering the potential for higher profits, although the risk associated with such volatile pairs are many. Overall, a look at previous volatility tells us how likely price will fluctuate in the future, although it has nothing to do with direction.All a trader can gather from this is the understanding that the probability of a volatile pair to increase or decrease an X amount in a Y period of time, is more than the probability of a non-volatile pair. Another important factor is, volatility can and does change over time, and there can be periods when even highly volatile instruments show signs of flatness, with price not really making headway in either direction. Too little volatility is just as problematic for markets as too much, we uncertainty in excess can create panic and problems of liquidity. This was evident during Black Swan events or other crisis that have historically roiled currency and equity markets. Read this Term affect CMS Prime? For example, is there an impact on trading volumes due to the recent trade wars or  Brexit  Brexit Brexit stands for British Exit, or in reference to the United Kingdom’s decision to formally leave the European Union (EU) as declared in a June 23, 2016 referendum. In a more immediate sense, a tight vote and unexpected result helped drive British pound (GBP) to lows that had not been seen in decades. The day following the referendum, former Prime Minister David Cameron resigned from office where he was replaced by Theresa May, who later resigned from office on June 7th, 2019. Active Prime Minister Boris Johnson was elected Prime Minister the following month, who was well-known as a headstrong Brexit supporter.  While the United Kingdom was predicted to leave exit the EU by October 31st, 2019, the U.K. Parliament sought out a deadline extension that delayed voting on the new deal.  Following Boris Johnson’s reelection, Brexit occurred on January 31st, 2020 at 11 pm Greenwich Mean Time.  Brexit Creating Ongoing Issues in with Europe While the United Kingdom is in a transition period following its departure from the EU, the U.K. is negotiating its complete trade relationship with the EU, which is the United Kingdom’s largest trade partner. Terms of this trade agreement must be met by January 1st, 2021. Should terms of this trade agreement take longer than the projected resolution date of January 1st, 2021 then the U.K. must acquire an extension no later than June 1st, 2020. Failure to do so will result in the U.K. is subject to tariff and host rule changes exercised by the E.U. This situation is referred to as the “no-deal” Brexit and should this occur the consequences could result in a significant fallout of the U.K. economy.  For the past few years, many banks and lenders operating previously in the UK had been given passporting rights to the European continent. The lingering uncertainty caused by Brexit resulted in many of these lenders relocating their European headquarters within continental Europe. Brexit stands for British Exit, or in reference to the United Kingdom’s decision to formally leave the European Union (EU) as declared in a June 23, 2016 referendum. In a more immediate sense, a tight vote and unexpected result helped drive British pound (GBP) to lows that had not been seen in decades. The day following the referendum, former Prime Minister David Cameron resigned from office where he was replaced by Theresa May, who later resigned from office on June 7th, 2019. Active Prime Minister Boris Johnson was elected Prime Minister the following month, who was well-known as a headstrong Brexit supporter.  While the United Kingdom was predicted to leave exit the EU by October 31st, 2019, the U.K. Parliament sought out a deadline extension that delayed voting on the new deal.  Following Boris Johnson’s reelection, Brexit occurred on January 31st, 2020 at 11 pm Greenwich Mean Time.  Brexit Creating Ongoing Issues in with Europe While the United Kingdom is in a transition period following its departure from the EU, the U.K. is negotiating its complete trade relationship with the EU, which is the United Kingdom’s largest trade partner. Terms of this trade agreement must be met by January 1st, 2021. Should terms of this trade agreement take longer than the projected resolution date of January 1st, 2021 then the U.K. must acquire an extension no later than June 1st, 2020. Failure to do so will result in the U.K. is subject to tariff and host rule changes exercised by the E.U. This situation is referred to as the “no-deal” Brexit and should this occur the consequences could result in a significant fallout of the U.K. economy.  For the past few years, many banks and lenders operating previously in the UK had been given passporting rights to the European continent. The lingering uncertainty caused by Brexit resulted in many of these lenders relocating their European headquarters within continental Europe. Read this Term negotiations?

Market volatility is always important for any brokerage. Extreme volatility, isolated to very specific events however can be dangerous for clients, i.e. Swiss National Banking decision a few years ago.

We look to educate our clients by informing them of any risk in trading. This is especially true in times of greater market turmoil or volatility. We have seen a healthy uptick in volumes due to Brexit and we expect this continue heading into this fall.

We would also like to reiterate the importance of our client in taking necessary precautions against large trading movements in GBP pairs.

What instruments are most in demand by CMS Prime’s clients and do you foresee this changing at all in Q4 2019?

Traditionally, our clients have always focused on the G7, Gold and Oil. While that continues to be in strong demand, in recent times, we have seen a surge in demand for CNH and Indices especially the US and German indices.

In Q4, we expect trading on similar lines, however with the uncertainty around Brexit, we see traders trading a lot on GBP and Euro pairs.

Regulations have been a stifling force in the retail industry over the past two years. In what ways has CMS Prime managed to weather this trend and stay ahead of the competition?

We understand that regulations have been the talking point recently given the restrictions imposed by various regulators.

We welcome the regulatory changes which would bring more transparency in the market and would yield in stronger customer assurances about the industry.

We give a lot of emphasis on education and constantly update our clients and try and convince them about the benefits of a stronger regulation which actually benefits them by minimizing the risk taken by clients and brokers alike while trading.

Our clients appreciate our inputs and realize that we as a broker are looking towards the clients well being and any steps taken are better for the clients.

Do you foresee any new developments, offerings, etc. in the pipeline at CMS Prime for next year?

CMS Prime has always given a lot of importance towards innovation whether it is in marketing, product development or technology.

We are looking at expanding our client base in Africa and Eastern Europe by setting up offices there. We are also going to introduce different Equities as a lot of clients have shown interest in that.

From the technology perspective, we are upgrading our entire technology into a more robust one. We are integrating our technology with other technology providers so that clients have a seamless trading infrastructure.