Plus500 Revenues Almost Halved in Q2 Compared to Previous Quarter

Plus500 has released its latest trading update revealing the amount of damage from the impact on the firm's operations in the U.K. Revenues in the second quarter have decreased materially when compared to the previous one to $43 million. This is 47.5 percent down quarter-on-quarter and remains lower than a year ago by about 5 percent.

The company explains the decline due to the seasonality of the markets, however if the previous year is any guide to the revenues of brokers, 2015 should be looking much better than last year. For the first half of 2014 the currency market Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad Read this Term dramatically impacted volumes and revenues around the retail trading industry.

Plus500 has highlighted that all of the clients in the U.K. who were pending verification after their accounts were frozen due to lack of appropriate verification required by the U.K. Financial Conduct Authority (FCA) regulatory body have been cleared. The total figure of accounts reviewed by the company stands at 13,499.

According to the company's announcement 72 percent of those accounts, or 8,758 clients, have continued trading. The number of accounts which deposited additional funds is reported at 5,261.

In the meantime, 6 percent or 874 clients have chosen to cash out, while a total of five accounts have been suspended due to failures to comply with Anti-Money Laundering (AML) Anti-Money Laundering (AML) Anti-money laundering (AML) is a term that describes laws, processes, and regulations that are intended to prevent illegally obtained funds from being disguised as income gained through legitimate means. The fundamental purpose of the AML laws is to help safeguard, detect, and report suspicious activity including the predicate offenses to money laundering and terrorist financing, such as securities fraud and market manipulation.Most exchanges have AML measures that include identity verification Anti-money laundering (AML) is a term that describes laws, processes, and regulations that are intended to prevent illegally obtained funds from being disguised as income gained through legitimate means. The fundamental purpose of the AML laws is to help safeguard, detect, and report suspicious activity including the predicate offenses to money laundering and terrorist financing, such as securities fraud and market manipulation.Most exchanges have AML measures that include identity verification Read this Term) procedures.

Plus500 has indicated that on-boarding of new customers in the U.K. is likely to resume in about three weeks time after the company hires external consultants to address compliance issues.

The firm has also communicated to shareholders that it will publish its key performance indicators (KPIs) before the vote on the acquisition by Playtech, to be held on the 16th of July in London.