Plus500 Share Discussion Threads

[nurdin] 16/1/2018 10:40

Indeed.

Wish ESMA would come out with their recommendations now...the anticipation is choking the share price!

[sailing john] 16/1/2018 08:46

Massive fall in all major cryptos today 15-20% approx (recovering a little now off 10-15%)
PLUS still appear to be encouraging sellers (contract size, premiums etc.) so I assume any imbalance will (on this occasion) work in their favour
Most importantly though volatility in either direction is good for business!
SJ

[sailing john] 12/1/2018 10:32

"Swiss online banking and brokerage leader Swissquote Group Holding SA (SWX:SQN) has announced that it will report better-than-expected results for the second half of 2017 (when final results are released in early March)."
Due mainly to crypto trading -

[michaeljames1] 11/1/2018 15:28

Doesn't seem to be slowing down either, with all the new currencies coming in its just drawing more attention to whole cryptocurrency system, of which PLUS cater for the main ones.

[sailing john] 11/1/2018 14:50

Doesn't look like worldwide interest in cryptos is fading - 240k new customers in an hour for Binance (after temp closure 5th Jan) and up to 2 million in a week put PLUS's remarkable 150k/quarter into perspective.


And - Bitcoin CFD pair BTCUSD has become most traded instrument on Leverate platform in 2017 0.5% in Jan 17 to 42.5% in Dec 17!

[nurdin] 11/1/2018 14:00

I think it is the concerns about the upcoming EASMA report that is causing some nervousness.The report should be out soon...

[aakash30] 10/1/2018 21:33

Agree with the view that this should be good for the large incumbents (Plus, IG and CMC). It's also important to remember that regardless, Plus has a much more diversified revenue stream with only 20% of revenues from the UK unlike IG that has more like 45% of revenues from the UK

[thorpematt] 10/1/2018 20:16

I have read that letter and all the guidance. Pretty tedious.

Sometimes it's better to consider the wider priciples. In essnece PLUS sits outside pretty much the crux of FCAs targeting in this letter (although it discusses other issues too). Furthermore some of the "competition" for client money does NOT.

What does that correlate to in my "simple equation of effect"?
Answer: Bad for the competition = good for PLUS.

Ironically, as news goes, today's was pretty tidy for those CFD providers who do not offer and distribute CFDs to retail customers advisory or discretionary portfolio management basis. NOT so good for those that do.

The rest of the "news" was already in the market...and thus in the price.

Where does the letter leave the wider issues mentioned. Well again we've talked about it before. The FCA really is sayiing that proffessionals and retail clients need different protection and therefore leverage limits. There is a reduction therefore in profitablility for providers (in theory). Again, however this is OLD NEWS.

[nurdin] 10/1/2018 17:26

Yes..daft reaction

[metis20] 10/1/2018 17:23

So much for today's share price drop!!

"Whilst the FCA issued this "Dear CEO letter" to all CFD providers, Plus500 did not receive any individual communication on the review findings as it does not and has never offered its products via these routes."

RNS issued at 4:37pm today

Response to FCA's 'Dear CEO' Letter

Plus500, a leading online service provider for retail customers to trade CFDs internationally, takes note of the contents of a "Dear CEO letter" that the Financial Conduct Authority ("FCA") has today issued as a public announcement following its review of the CFD market.

The announcement highlights the FCA's concerns regarding firms who offer and distribute CFDs to retail customers on either an advisory or discretionary portfolio management basis.

Whilst the FCA issued this "Dear CEO letter" to all CFD providers, Plus500 did not receive any individual communication on the review findings as it does not and has never offered its products via these routes.

Asaf Elimelech, Chief Executive of Plus500 said:

"The guidance contained in the FCA's letter today is not directly applicable to our business model. However, we take note of the FCA's comments and guidance and we continue to ensure best practice compliance with the current regulatory regimes in all the jurisdictions in which operate.

"We continue to believe that these and other changes will enhance the CFD trading landscape and ultimately reduce the number of providers to a core of higher quality operators, of which we intend Plus500 to be amongst the leaders."

[nurdin] 10/1/2018 16:46

Very amusing lol

(Posted the wrong link before..senility creeping in !)

[stuffee] 10/1/2018 16:27

f66

..... or see the FCA insisting on ridiculous health warnings on every contract note .... Warning CFD punting can seriously damage your wealth etc.

Thanks to PL and SJ for the most helpful comments on the FCA statement. I still feel the limit to any losses incurred by Plus' punters to their cash commitment is the crucial point and this overcomes the FCA's greatest concerns.

[fenners66] 10/1/2018 15:40

"they report that during the period under observation 76% of retail punters lost money with CFDs"

Better close down Lotto, Euromillions, Health Lottery etc etc then......

[planelondon] 10/1/2018 14:06

Sj, you have bagged the nail on the head.

These changes are already happening and driving down AUAC across the industry. Actually, from the feedback I'm getting, the price of a new customer has plummeted.

Like any business, if your largest input cost dramatically falls and your output price remains relatively stable, you're you are in a good place.

New online marketing techniques are increasingly able to target very precisely, new customers over the web. It is possible to consider over 100 items of data (touch points) on a potential customer before you have to decide whether or not to spend time and money placing advertising in front of them. Think of the amount of money you can save by not targeting the wrong potential customers (those with no money and those who cannot meet regulatory requirements). There is no reason why you cannot define regulatory appropriateness and suitably within your targeting criteria (i.e. earnings, employment etc.).

Marketing journals are reporting that these new techniques are reducing APUC in other industries, by as much as 75% with returns on marketing spend 4:1 times higher than traditional online marketing channels.

[sailing john] 10/1/2018 13:01

Thanks for the clarification PL. Affiliates appear to play an important role in advertising although for PLUS that is diminishing as they become well known within the market as one of the leaders in the retail sector. High profile sponsorship helping here. I did worry that fees quite high (now reduced especially for crypto customers) although I suspect many (like me) prefer to visit and research sites directly before signing up rather than via a click through unless the affiliate is offering an incentive which I think has been eliminated by regulation.
The market is clearly changing and ultimately this might be good for PLUS with lower AUAC and less competition.
GL - SJ

[planelondon] 10/1/2018 12:22

Sj, affiliates are classed as 'distributors' by the FCA. Plus500 used to be the pioneer/leader in this area. Not so much now. Plus500 revamped all their affiliate terms and condition in December 2017 in anticipation of today's announcement.

Further, Plus500 removed 'revenue share' deal (in-line with regulators emphasis on incentives and conflicts of interest)and reduced CPA from as high as $800 to $300 per new customers introduced.

It looks like Affiliates will play a diminishing and less important role in Plus500's customer acquisitions in the future. It makes good commercial sense too - why would you want to pay someone else $800 (with regulatory distribution risk) to bring a customer that you are now capable of bringing yourself at a cost of less than £300.

hxxp://www.500affiliates.com/help/AffiliationAgreement.aspx

[alan00] 10/1/2018 12:20

Missed this earlier, but as Paul Scott pointed out on the SCVR, the review is specifically for advisory or discretionary offerings:"It looked at where firms offer these complex, high-risk instruments to retail customers on either an advisory or discretionary (including limited power of attorney) portfolio management basis."I wouldn't have thought PLUS 500 were involved in this type of offering, I'd think they are just execution only.

[nurdin] 10/1/2018 12:17

FCA have done a lot of barking but have not taken any action, atleast as yet..As IGG say,it has no financial implications for the providers like them..ESMA report will be more crucial however.

[planelondon] 10/1/2018 12:06

As a long-term shareholder, I would much rather see the large five providers lobby for an oligopoly (which the regulators appear to support), rather than spend time and resource arguing over whether a customer should have 1:50 or 1:30 leverage on fx.

[basem1] 10/1/2018 11:59

They'll be introducing rules for investors that lose on Aim next. No one puts a gun to people's heads and says Gamble. But I'm a capitalist pig so I'm bound to think like this.

[sailing john] 10/1/2018 11:47

Statement from IG


PLUS don't use Distributors either afaik
IG price recovering - PLUS should follow once market digests

[planelondon] 10/1/2018 11:45

In 12 months times, I see only the main providers; Plus500, CMCX, IGG, Playtech and Saxo Bank with a handful of other providers operating in the market as they do now. In my views. these providers should be lobbying the FCA/ESMA to ensure no providers outside the EU have any access whatsoever to the market after the implementation of the new rules. They should demand strict monitoring and enforcement as part of the new measures. Especially, around outside providers offering leverage above the amount they can legally provide.

[nurdin] 10/1/2018 11:41

Cheers planelondon...

[planelondon] 10/1/2018 11:27

Nurdin, Introducing Brokers (sometimes authorised and sometimes not), white label relationships and affiliates are all classified as distributors. Basically, any customers who have not gone or been sourced directly by the provider are likely to have come via a distributor (introducing broker). For small and medium-sized providers this distribution channel can be 100% of their new customer flow.