IG Group Holdings plc
FormerlyIG Group Holdings Limited (2003–2005)
TypePublic limited company
IndustryFinancial services
Founded1974
HeadquartersLondon, England, United Kingdom
Key people
Services
  • OTC
  • EDT
  • Stock trading
RevenueIncrease £979.2 million (2022)[1]
Increase £477.3 million (2022)[1]
Increase £503.9 million (2022)[1]
Number of employees
2,507 (2022[1])
Subsidiaries
  • DailyFX
  • tastytrade
  • Spectrum Markets
  • Raydius
  • BrightPool
Website
Footnotes / references
[2]

IG Group Holdings plc,[2][3] trading as IG Group, is a United Kingdom-based online trading provider, offering access to spread betting and CFD trading, which allow traders to bet on the direction of equities, bonds and currencies without owning the underlying assets.[4][5]

Established in 1974 by Stuart Wheeler, the company is based in London and employs 1,950 staff.[6]

As of 2021, it had a market value of £2.9 billion and offered trading in 17,000 investment markets. IG is regulated by the Financial Conduct Authority (FCA), the UK's financial authority body.[7][8][9][10] It is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index.[11]

History

Founding and early years (1974– 2000)

IG Group, founded as IG Index, was founded in 1974 by British financier Stuart Wheeler.[12] IG Index was launched as the first spread betting company.[13] Rather than buying physical gold, the company allowed investors to trade gold prices.[14]

In July 2000, IG Group was formed as a parent company of IG Index and shares first began to be traded on the London Stock Exchange.[15]

Expansion (2001– 2010)

In 2002, IG Group entered the international market for the first time by expanding its business to Australia.[16]

In 2003, private equity firm CVC Capital Partners backed a management buyout of IG Group for a total of £143 million.[17] In April 2005, IG Group stock was brought back to the market valuing the company at £1.3 billion, and CVC sold off 15.1 million IG Group shares worth £58 million.[18]

In 2007, IG Group entered the United States market for the first time by purchasing HedgeStreet, a digital marketplace allowing investors to trade financial derivatives online, for £2.9 million.[19] In June 2009, the company was renamed to Nadex.[20]

In September 2008, IG Group expanded into Japan by purchasing private online exchange trading firm FXOnline for £112 million.[21]

In 2010, IG Index, IG Group's spread betting firm, was hit with a claim for €25 million by three former clients of defunct Scottish trading firm Echelon Wealth Management for unspecified losses.[22]

Further development (2011–present)

In June 2011, IG Markets shut down its traditional fixed-odds sports service extrabet, which had an emphasis on in-play betting. The fixed odds sport service was shut down to focus on financial wagers, after failing to find a buyer for the whole unit.[23] In September 2014, the company started its own online stockbroking platform offering some 4,500 stocks.[24]

In January 2015, the Swiss National Bank announced that it would be discontinuing its minimum exchange rate policy. IG customers incurred losses of £18.4 million after it happened. They accused the company of breaching UK regulations by acting out of self-interest and alleged a failure by company to provide the best execution to everyone.[25][26] In October 2015, after claims by many of the firm's clients,[27] IG "accepted a ruling by the UK’s Financial Ombudsman Service that it should compensate customers for money lost during a rapid appreciation of the Swiss franc in January".[28]

In September 2016, IG Group acquired DailyFX, a foreign exchange trading news and research portal, from FXCM for $40 million.[29] Later, in December, Peter Hetheringon, the CEO of the company, criticised the Financial Conduct Authority in the UK after it announced new measures to overhaul the industry, publicly blaming the regulator for weakness in some aspects of implementation and its lack of understanding of what the proposed changes could bring.[30]

In December 2016, the FCA questioned whether binary bets "serve a genuine investment need" and defined them as more akin to gambling. Aside from most consumers losing money, the FCA's other concerns included the addictive nature of binary options betting, and inherent conflicts of interest. "Since 2012 there have been a reported 2,605 victims who lost a total of £59.4m on binary options scams – an average of nearly £23,000 each".[31] In 2017, investors lost more than £87,000 a day on binary option scams alone.[31]

In January 2017, IG group announced their decision on withdrawal of the binary options betting product, admitting that the arrival of the regulator to the market would significantly worsen the company's state of affairs. The director of IG corporate affairs stated: "I think that product will come under regulatory pressure in the future. That does not influence our view – it's simply a fact." At the same time, analysts stated that the IG's binary option withdrawal has been more akin to provocation: "It was a pre-emptive measure to mitigate further regulation".[32]

In April 2017, IG Group launched IG Smart Portfolios – a suite of ETF investment portfolios created in partnership with BlackRock, marking the company's first move into online wealth management.[33] In February 2019, IG Group launched IG US to enter US market.[34]

Following his tenure as Chief Financial Officer, Tim Hawkins was appointed CEO in October 2006, retiring 9 years later in 2015.[35] Following the departure of Tim Howkins, Peter Hetherington became CEO in October 2015, having started at the company as a graduate trainee in January 1994. He later stepped down in September 2018.[36]

In October 2018, IG Group appointed June Felix as CEO.[37] Felix served as a non-executive director for three years before joining the board.[38] As of October 2020, Felix also serves on the board at Relx PLC.[39]

In February 2021, IG Group and 34 other brokers and hedge funds were targeted by an antitrust class action lawsuit for allegedly conspiring against non-professional investors when GameStop short squeeze took place. According to the plaintiff, the defendants hatched an uncompetitive scheme to limit the trading of certain securities after the failure of their highly speculative short-selling strategies, thus violating state antitrust laws.[40]

In March 2021, FinanceFeeds and Financial Magnates reported that IG Group's system, supposedly accustomed to low volatility periods, faced frequent outages at the time of higher-than-usual trade volumes.[41][42] Such crashes left clients unable to control the positions, leading to loss of funds. According to FinanceFeeds, during the January 2021 outage, IG Group provided no customer support (up to not answering the phone calls) but immediately reacted to request for commentary to protect its public image and deny the issues raised by the clients.[43]

IG acquired tastytrade in June 2021 for $1bn, a trading platform catering to individual investors. Privately owned tastytrade was co-founded in 2011 by Tom Sosnoff who also founded thinkorswim, a brokerage firm that was acquired by TD Ameritrade for $606million in 2009, and Dough, Inc.[44] Subsidiary tastyworks was launched in January 2017 as a brokerage arm of tastytrade.[45]

In December 2021, IG brokered a deal for the sale of North American Derivatives Exchange (Nadex) and a 39% stake in Small Exchange Inc to Foris DAX Markets Inc, which trades as Crypto.com, completing the $216 million sale in March 2022.[46] Nadex is a U.S. derivatives exchange regulated by the Commodity Futures Trading Commission encompassing short term binary options.[47]

ESG Investing

In 2019, IG partnered with Teach First to train 16 teachers in STEM subjects (Science, Technology, Engineering and Mathematics). This partnership was extended to create a £2 million fund supporting children in disadvantaged areas, specifically affected by the negative impacts of the Covid-19 pandemic on the education system.[48] IG Group launched its environmental, social, and governance (ESG) strategy, Brighter Future, in 2020.[49]

IG's Brighter Future Fund launched in early 2020 at the start of the Covid-19 pandemic, focusing on the education and development of young people irrespective of race, gender or socioeconomic background.[50]

Operations

In 2012, IG Group consolidated its business in the UK under one brand, IG. IG Group is now, therefore, the sole trading name of the operating companies:[51]

Sponsorship

During its history, IG Group signed some notable sponsorship deals:

See also

References

  1. 1 2 3 4 "Annual Report 2022" (PDF). IG Group. Retrieved 7 February 2023.
  2. 1 2 "IG GROUP HOLDINGS PLC overview - Find and update company information - GOV.UK". Companies House. 25 February 2003. Retrieved 5 September 2023.
  3. ↑ "Terms and Agreements". IG Group. Retrieved 5 September 2023.
  4. ↑ "Online Summary 2022". Brand and reputation, IG annual report. 17 March 2022.
  5. ↑ Ben Martin (25 April 2020). "IG Group boss is betting that global expansion can be its game-changer". Retrieved 14 June 2022.
  6. ↑ Ben Martin (25 April 2020). "IG puts on spread for staff with bumper bonus round". Retrieved 14 June 2022.
  7. ↑ Ben Martin (25 April 2020). "IG Group boss is betting that global expansion can be its game-changer". Retrieved 14 June 2022.
  8. ↑ Ben Martin (23 February 2021). "IG Group pulls plug on leveraged share bets". Retrieved 4 June 2022.
  9. ↑ "FCA IG Markets Limited". Financial Conduct Authority. Retrieved 9 July 2019.
  10. ↑ "FCA IG Index Limited". Financial Conduct Authority. Retrieved 9 July 2019.
  11. ↑ "FTSE 250 - Indicative Index Weight Data as at Closing on 31 December 2014". FTSE. 31 December 2014. Archived from the original (PDF) on 24 February 2019. Retrieved 10 May 2015.
  12. ↑ "Spread bets firm IG Index holds £110m market slip". The Telegraph. 10 June 2000. Retrieved 26 October 2023.
  13. ↑ Zainab Hussain, Noor; Radhika, Rukmangadhan (21 September 2017). "IG Group's first quarter revenue jumps on expanded client base". Reuters. Retrieved 25 October 2023.
  14. ↑ Koilparambil, Aby Jose; Shabong, Yadarisa (15 March 2023). "UK's IG Group revenue drops in quiet Dec-Feb quarter". Reuters. Retrieved 25 October 2023.
  15. ↑ Hyland, Anne (6 July 2000). "Rival bookmakers bet on IG price". The Guardian. ISSN 0261-3077. Retrieved 26 October 2023.
  16. ↑ "IG chief predicts end of market tranquillity". The Telegraph. 24 November 2014. Retrieved 9 November 2023.
  17. ↑ Dewson, Andrew (28 April 2005). "IG Group floats with a half-penny premium". Financial News. Retrieved 14 November 2023.
  18. ↑ "UPDATE 1-CVC sells $90 mln stake in IG Group". Reuters. 11 May 2010. Retrieved 14 November 2023.
  19. ↑ Turner, Lorraine; Hoskins, Paul (24 September 2008). "UPDATE 2-British spread-better IG buys Japan's FXOnline". Reuters. Retrieved 14 November 2023.
  20. ↑ "HedgeStreet Changes its Name to the North American Derivatives Exchange, Inc. (Nadex) | Nadex". Retrieved 14 November 2023.
  21. ↑ Tucker, Sundeep (24 September 2008). "IG Group buys Japanese trader". Financial Times. Retrieved 10 November 2023.
  22. ↑ Nick Hasell (24 November 2010). "IG Index hit with £21.4m lawsuit by clients of defunct broker Echelon Wealth Management". The Telegraph. Retrieved 14 November 2023.
  23. ↑ David Altaner (19 July 2011). "IG Logs Full-Year Loss After Taking Japan-Unit Charges". Bloomberg. Retrieved 31 July 2010.
  24. ↑ "IG launches online stockbroking platform". The Daily Telegraph. 15 September 2014. Retrieved 14 April 2015.
  25. ↑ "IG accused of prioritising own trades during Swiss franc frenzy". Reuters.com. 4 June 2015. Retrieved 15 August 2018.
  26. ↑ "How could a teacher on £18,000pa lose £280,000 spread betting?". Independent.co.uk. 18 March 2015. Retrieved 15 August 2018.
  27. ↑ "IG Group to Face UK Ombudsman over Black Thursday Losses". Finance magnates.com. 8 September 2015. Retrieved 10 June 2018.
  28. ↑ "IG Group Repays $1.5 Million to Clients Over Swiss Franc Turmoil". Bloomberg L.P. 7 October 2015. Retrieved 22 October 2015.
  29. ↑ "Breaking: IG Group Buys DailyFX from FXCM for $40m". Finance Magnates. 30 September 2016. Retrieved 5 January 2016.
  30. ↑ "IG Group Boss Attacks FCA Crackdown Urging Customers to Join the Battle". Finance Magnates. 30 September 2016. Retrieved 15 December 2016.
  31. 1 2 "Online investment scams on the rise, financial watchdog warns". The Telegraph. 29 January 2018. Retrieved 27 January 2016.
  32. ↑ "IG Group withdraws from binary betting after watchdog clampdown". The Telegraph. 24 January 2017. Retrieved 2 October 2018.
  33. ↑ Tom Eckett (6 April 2017). "IG launches suite of model portfolios in partnership with BlackRock". Investment Week. Retrieved 1 June 2017.
  34. ↑ "Breaking: IG Group Officially Launches IG US | Finance Magnates". Finance Magnates | Financial and business news. 1 February 2019. Retrieved 9 April 2019.
  35. ↑ "IG Group chief exec Tim Howkins to quit group and retire in October". 21 July 2015. Retrieved 7 June 2022.
  36. ↑ Maria Nikolova (27 September 2018). "Peter Hetherington to Step down as CEO of IG Group". Retrieved 7 June 2022.
  37. ↑ "IG Group appoints ex-Citi and IBM executive as first female CEO". Reuters. 30 October 2018. Retrieved 31 October 2018.
  38. ↑ Hannah Finch (25 February 2022). "The 18 women leading top firms in the FTSE 350 in 2022". Retrieved 7 June 2022.
  39. ↑ "June Yee Felix". Bloomberg News. Retrieved 7 June 2022.
  40. ↑ Corrade Rizzi (2 February 2021). "'Bad Bets': Antitrust Class Action Alleges Major Brokerages, Hedge Funds, Clearinghouses Conspired Against Ordinary Investors". ClassAction.org. Retrieved 3 March 2021.
  41. ↑ Aziz Abdel-Qader (21 May 2020). "Clients of IG Group Suffer System-Wide Outage, Broker Says Back to Normal". Finance Magnates. Retrieved 3 March 2021.
  42. ↑ Celeste (22 May 2020). "IG Group Experiences Further Platform Issues". Finance Magnates. Retrieved 3 March 2020.
  43. ↑ FinanceFeeds (29 January 2021). "IG Group platform crashes yet again, with traders being left out in the cold". FinanceFeeds. Retrieved 3 March 2021.
  44. ↑ Alexander Osipovich (21 January 2021). "Britain's IG Group to Buy U.S. Options Firm Tastytrade for $1 Billion". Retrieved 6 June 2022.
  45. ↑ Nils Pratley (21 January 2021). "Let's hope Cineworld's shameless bonus scheme proposal flops". TheGuardian.com. Retrieved 6 June 2022.
  46. ↑ Tom Waite (2 March 2022). "IN BRIEF: IG Group completes sale of Nadex to crypto.com". Retrieved 7 June 2022.
  47. ↑ Joanna Ossinger (1 December 2021). "Crypto.com Buys IG's Stake in Citadel, Peak6-Backed Exchange". Bloomberg News. Retrieved 7 June 2022.
  48. ↑ "IG Group and Teach First Launch £2M Education Fund Due to Covid-19 Crisis". 24 April 2020. Retrieved 1 June 2022.
  49. ↑ Maria Nikolova (14 December 2021). "IG Group to give 1% of post-tax profits for charity". Retrieved 1 June 2022.
  50. ↑ "IG Group CEO interview: ESG, diversity and IG's Brighter Future programme". 14 December 2021. Retrieved 1 May 2020.
  51. ↑ "IG Group Our History". IG Group. Retrieved 9 July 2019.
  52. ↑ "IG Index Limited". FCA. Retrieved 31 March 2017.
  53. ↑ "IG Markets Limited". FCA. Retrieved 26 May 2017.
  54. ↑ "IG Markets, patrocinador del Getafe CF SAD". Rankia.com (in Spanish). 23 August 2010. Retrieved 10 May 2015.
  55. ↑ Kröner, Hedwig (18 November 2010). "Sky announces new co-sponsor". Cyclingnews.com. Retrieved 10 May 2015.
  56. ↑ Noble, Kelly (10 December 2010). "IG Markets Sponsors Two Stages of Santos Tour Down Under". Glam Adelaide. Retrieved 10 May 2015.
  57. ↑ Dormio, Nunquam (16 October 2013). "Quins sign new sponsorship deal". RugbyNetwork.com. Retrieved 10 May 2015.
  58. ↑ "Harlequins announces IG as Principal Partner". Quins.co.uk. 4 September 2014. Retrieved 10 May 2015.
  59. ↑ Nikolova, Maria (5 May 2015). "IG partners with Melbourne Football Club". LeapRate. Retrieved 10 May 2015.
  60. ↑ Performance Specification for Mens and Boys Knitted and Woven Beachwear and Sports Shirt Fabrics, ASTM International, doi:10.1520/d4154, retrieved 8 September 2022
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