Welcome to the third edition of CMC’s Institutional Leader. For global businesses and financial markets alike, it has continued to be an unprecedented few months. With many of us still working from home for at least part of each week, it seems as if we now have to get used to a new normal. I joined CMC Markets as B2B Marketing Manager from Acuris back in April. It was certainly a strange environment for anyone to change jobs, but I couldn’t have been made to feel more welcome. The way both this company and the wider industry have responded to the demands of remote working has shown the real benefits of the technology that lies behind systems used to power financial markets. To be part of such a dynamic environment is an absolute privilege.
In early June, CMC Markets released its FY2020 results. Highlights included the smooth group-wide transition to remote working and the resilience of the platform with best in class availability and execution times being maintained during extraordinarily high levels of trading activity. Net operating income increased by 93% to £252.0 million, with our Chief Executive Peter Cruddas noting the growing contribution B2B activity was playing, adding that it will continue to be an important part of the strategy going forward.
A corporate trading update at the start of July showed that there was no let-up in client activity in the first quarter, leading to a profit upgrade for the full year.
CMC Markets also assisted Celer Tech with the deployment of our Direct API feed, allowing prices for almost 10,000 different instruments to be integrated with wider pools of liquidity. Integrations like this are recognised as being increasingly popular solutions for those clients who are seeking multi-asset exposure but find themselves constrained by the FX-centric provision of other liquidity providers.
At the Global B2B Forex Awards, which were announced in June, CMC Markets Institutional was heralded as being the Best White Label Provider. A lunch for the award winners should have been hosted in London, but owing to the lockdown this was cancelled, with the organisers instead making a donation to the World Health Organisation’s COVID-Solidarity Response Fund.
Our group head of trading, Simon Campbell, participated in a Q&A with FX Markets Magazine. Discussing how markets fared with recent volatility in the new liquidity landscape, this article appeared in the publication’s June edition.
Simon Campbell and our head of Institutional, Richard Elston, were interviewed in podcast format by Larry Levy of e-Forex Magazine in late June. The conversation touched on a range of subjects including sculpted liquidity and why CMC Markets can offer better value than a pure Prime of Prime agency broker solution.
In recent weeks, we have launched a new ‘Donor Account’ facility that offers an override function for grey label account providers. This allows our partners to better configure platforms to meet the needs of local clients, rather than all end-users having to start with a default CMC Markets layout.
The product library functions on the retail trading platform available to white label clients have also been updated. Users can now add and configure as many as six product libraries simultaneously for each screen layout they have. Search functionality has been improved and curated, ‘topical’ watchlists are also now available.
Market insights & trends
With central banks globally showing no let-up in their stimulus endeavours, equity valuations have largely recovered from the initial shock, seen as COVID-19 left European and North American economies shutting down. However, this rebound isn’t without risk. Either a second wave of the virus or a failure of central banks to convince markets they have developed successful exit strategies could trigger another sell-off.
Over the last few months, whilst there has been a notable decline in volatility from the peak which was seen in March, there’s no escaping the fact markets still remain very active. Annualised volatility on a number of FX pairs may be moving close to the levels seen six months ago, but this pattern hasn’t been repeated for other asset classes, most notably equity indices and some commodities. Significantly, price travel and high-low ranges remained elevated, implying decent intraday volatility versus daily closing prices.
In July we announced the appointment of Brendan Foxen into the newly created Chief Technology Officer role. This post has been created to ensure CMC’s technology remains at the forefront of the sector. Brendan joins from Contino, a digital transformation consultancy, where he worked with a number of highly regulated enterprise organisations such as Allianz and EDF. Brendan has previously held roles with companies including Channel 4 and Cable & Wireless.
Lachlan Wheeler has joined the institutional services team in Sydney. He was previously part of the company’s Client Services division so is already familiar with the operation processes used by CMC Markets. Lachlan forms part of Andrew Wood’s growing team, looking after Australia and the wider APAC market.
Keeping in touch
In addition to this quarterly bulletin, we also provide regular updates on our dedicated CMC Markets Institutional LinkedIn page. Please feel free to follow us at https://www.linkedin.com/showcase/cmc-markets-institutional/ for the most up to date news of all our latest developments.