CMC Markets PLC (LSE:CMCX) said it expects first-half profits will be up 21% as high market volatility drives client trading volumes and announced that it has just launched its new UK investment platform that it sees as a “major opportunity for growth and diversification”.
The FTSE 250-listed online broker expects net operating income to be roughly £153mln for the six months to 30 September 2022, up from £127mln a year earlier and faster growth than the 12% seen in the last full year.
First-half leveraged net trading revenue – from spread-betting and CFDs in the UK – are seen rising 27% to around £128mln and non-leveraged net trading revenue – from its investing business outside the UK – is anticipated to drop 14% to roughly £21mln.
The volatile markets in August and September underpinned the improvement in net operating income, the company said in a trading statement ahead of results next month, with this driving an increase in activity that offset a slightly lower number of active leveraged clients.
CMC Invest, the new online investment platform, was officially launched on the last day of the first half and, said chief executive Lord (Peter) Cruddas, “marks a significant milestone for us, representing a major opportunity for growth and diversification into the non-leveraged market”.
He said using the company’s technology the platform would aim to offer the “best technology and lower transactional costs and fees”, with users currently able to invest in UK and US shares, as well as ETFs and investment trusts at zero commission, with new features coming including investing in mutual funds, stocks and shares ISAs and currency wallets.
“We believe commissions, execution spreads and custodial fees have for too long been too high and too expensive for retail investors,” said Cruddas.
“CMC Invest will leverage our platform technology, including pricing and execution enhancements to drive down the transaction costs of investments for retail clients, just like we did in Australia, where we are already the number two investment platform for retail investors.”
He said the group is “on a fast track to diversification”, using its existing platform technology to win B2B and B2C non-leveraged business, with strategic growth plans “on track”.