We’ve got a new podcast out this week with FXCM founder Drew Niv. The recording ended up being over an hour but there is lots of interesting stuff covered, including…
- The early days of FXCM
- Things that worked well and what didn’t
- Thoughts on crypto
- Changes that are going to happen in the FX/CFD space because of interest rate hikes
- What to do in M&A
- FTX and working through a crisis
And most importantly – are the market forces at play going to make forex great again?
Listen below to find out.
Will Capital.com run out of people to hire from IG?
Legend has it that many aeons ago, when IG Group needed to jump on the mobile app trading bandwagon, they got someone in Belarus to do a lot of the work for them. I don’t know what ended up happening with that but, as the famous Seinfeld episode goes, yada yada yada Capital.com was founded by the same guy that helped build the app not long afterwards.
The connection between the two companies does not seem to have gone away though. Capital.com and Currency.com have some legendary hiring practices. Rumour has it that the company’s founder thought the Economist’s video team were good so he got someone to hire all of them (which they did).
But the company seems to have a particular penchant for hiring people from IG Group. Prior CEO Ivan Gowan was formerly the head tech person (or something similar) at IG. Current CEO Peter Hetherington was formerly CEO at IG.
Then you have the company’s head of clients who joined from IG (Moritz Gersdorff) the head of finance (Phil Hirst) who joined from IG and the Middle East CEO (Tarik Chabib) who joined from Pepperstone but spent much of his career at IG. You also have the CEO of APAC (Laura Lin) who was previously at IG and the head of customer service (Adam Clilverd) who was also at IG.
Former IG US CEO Rupert Osborne is now at Capital.com and the company’s new head of FX (Andrew Black) also joined from IG. Then you have Kypros Zoumidou, who was group commercial director at IG and is now in the same role at Capital.com. And Capital.com’s head of product (Tim Plummer) used to be head of platform innovation at IG. Other hires include sales people, institutional sales people and a former editor on their content team. And there are more.
Is this a deliberate strategy? Has Peter Hetherington gone all Oceans 11 and convinced the old gang to get back together for one last margin call? Or do they love him so much that they’d follow him wherever he goes? Whatever the case, it’s getting to the point where they’re going to run out of hires from IG to make. Should CMC start worrying?
CMC is adding options trading
Some readers may already be aware that this is a ‘thing’ but I wasn’t and think it’s worth covering.
Last week CMC Markets CEO did an update with Proactive Investors, where he noted that the company is going to be launching options trading.
“We’ve got a big release next year with options,” he said. “We’re building a big options platform, so we’re going to drive that forward.”
It’s hard to tell if this was in reference to the company’s B2B or B2C line. But assuming it’s the latter, this would make CMC one of several companies now either offering options/futures or moving to do so.
Among the big players, IG, eToro and Plus500 all now have options / futures trading or are in the process of rolling it out. Tickmill also seems to be making a big push to get customers to trade its options offering.
The question here is whether this is a particularly profitable endeavour. If you look at IG, for example, they are making a lot in revenue from their tastytrade acquisition but it’s not clear how profitable that is as a stand alone business.
However, the amount of money being put into adding options trading (IG spent $1bn on tastytrades and eToro just acquired Gatsby for $50m) would suggest that these businesses do believe it’s going to be profitable in the long-run. Unlike stock trading, which feels a bit like a fad or marketing gimmick, it seems probable that options trading is here to stay.
