Lower EBS volumes and revenues prompts comments on "Non bank" traders
Michael Spencer, CEO of ICAP, remarking on the drop in revenue of his company in electronic markets, exemplified by the reduction in activity on his foreign exchange platform, EBS, has praised the "non-bank trading institutions" such as Ken Griffin's Citadel and Virtu Financial Inc. which are coming in to fill the void left by retreating banks.
Focusing on Technology
Low interest rates have dampened activity from banks in the fixed income, currencies and commodities space in which brokers operate, inciting them to reorient their focus. In particular ICAP is investing in electronic markets, post-trade services and information services. ICAP has also expanded into fintech investment via its Euclid Opportunities initiative since 2011 run by Steve Gibson who was also at Calypso Technology previously.
Stock and Competitors
ICAP stock (IAP.L) was pressured downward following the results. It is regarded as riskier than the overall market with a beta of 1.17. It has a market cap of around 2.69 billion pounds. Its competitors include Tullet Prebon (which is buying ICAP's voice broking business) and Cantor Fitzgerald, which also runs its own investment arm, Cantor Ventures. They also have Cantor Gaming as one of their high technology ventures. Tullet's share price has also been going down, but it has a beta of only 0.75 so the impact, as can be predicted, is rather less than on ICAP.
Michael Spencer, CEO of ICAP, remarking on the drop in revenue of his company in electronic markets, exemplified by the reduction in activity on his foreign exchange platform, EBS, has praised the "non-bank trading institutions" such as Ken Griffin's Citadel and Virtu Financial Inc. which are coming in to fill the void left by retreating banks.
Focusing on Technology
Low interest rates have dampened activity from banks in the fixed income, currencies and commodities space in which brokers operate, inciting them to reorient their focus. In particular ICAP is investing in electronic markets, post-trade services and information services. ICAP has also expanded into fintech investment via its Euclid Opportunities initiative since 2011 run by Steve Gibson who was also at Calypso Technology previously.
Stock and Competitors
ICAP stock (IAP.L) was pressured downward following the results. It is regarded as riskier than the overall market with a beta of 1.17. It has a market cap of around 2.69 billion pounds. Its competitors include Tullet Prebon (which is buying ICAP's voice broking business) and Cantor Fitzgerald, which also runs its own investment arm, Cantor Ventures. They also have Cantor Gaming as one of their high technology ventures. Tullet's share price has also been going down, but it has a beta of only 0.75 so the impact, as can be predicted, is rather less than on ICAP.
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