Monday , August 26 2019

Plus500 dips after revealing dependence on bad bets


Plus500 Ltd., sponsor of Spanish soccer team Atletico Madrid, plunged after the broker revealed how much it has cushioned the blow of new rules with profits from customers’ bad wagers. It also warned 2019 earnings will take a hit.
The London-traded company recorded a $56 million trading gain by taking the other side of clients’ bets during the fourth quarter, which accounted for about a third of overall revenue. Plus500 clients lost money during the global market rout in the final months of 2018. Europe’s markets regulator has been clamping down on the sale of contracts for difference, or CFDs, which allow retail investors to make risky wagers with borrowed funds on stocks, bonds, foreign exchange and cryptocurrencies. Under the rules introduced in 2018, brokers are restricted in how they sell and market the derivatives, while customers face caps on how much they can borrow and lose.

About Admin

Check Also

Negative-yield debt in Japan not looked this good since 2008

Bloomberg Japan’s negative-yielding bonds were a surprise beneficiary of the collapse in global rates in ...

Leave a Reply

Your email address will not be published. Required fields are marked *