IG Group’s Profit Jumps as Retail Frenzy Boosts Trading Activity
London-based IG, whose $1 billion deal to buy U.S. rival tastytrade closed last month, said it expects annual revenue growth of 25% to 30% over the medium term for its high potential markets including tastytrade.
The company added it anticipates tastytrade to deliver revenue growth at the higher end of that range, even as it warned trading activity in the current year would ease from the peaks seen recently.
Trading volumes have remained strong so far in 2021 after pandemic fears led to record volatility in financial markets in 2020, as retail investors connected through social media platforms including Reddit to share trading tips, driving up stocks shunned by hedge funds.
IG, which allows traders to invest in financial instruments through its platform as well as mobile apps, said it added 134,880 new clients in financial year ending May 31, a 39% jump from a year earlier. Total active clients rose 31% to 313,300.
The company’s pretax profit surged to 450.3 million pounds ($617.54 million) for financial year 2021 from 295.9 million pounds reported a year earlier.
($1 = 0.7292 pounds)
(Reporting by Muvija M and Chris Peters in Bengaluru; editing by Vinay Dwivedi)