“Over 20% of 26 Degrees’ Brokerage Clients” Are Either Offering or Will Offer Pairs CFDs

Thursday, 31/10/2024 | 09:18 GMT by Arnab Shome
  • Finance Magnates recently interviewed 26 Degrees’ Group CCO, James Alexander, to learn about the demand for Pairs CFDs.
  • “The Japanese market specifically has shown a keen interest and is a strategic focus for us.”
A cake with 26 Degrees branding at the rebranding launch party, Photo: 26 Degrees
A cake box with 26 Degrees branding at the rebranding launch party, Photo: 26 Degrees

“Currently, over 20% of our global brokerage client base is either offering or in the process of releasing Pairs CFDs,” said 26 Degrees’ Group Chief Commercial Officer, James Alexander, to Finance Magnates following his company’s recent launch of Gold Pairs CFDs. He added: “That’s a significant number, and we expect it to become even more prominent in 2025 and beyond.”

“We Expect to See Demand Continue to Grow”

Alexander compared the demand for these instruments to the roll-out of Equity CFDs via API in 2017 and 2018. “Back then, very few broker clients offered Equity CFDs; now, the vast majority of major brokers have some form of Equity CFD offering,” he said. “In our opinion, Pairs CFDs will be no different.”

James Alexander, 26 Degrees’ Group Chief Commercial Officer
James Alexander, 26 Degrees’ Group Chief Commercial Officer

26 Degrees, previously known as Invast Global, launched Pairs CFDs last July, enabling the trading of index vs. index, commodity vs. commodity, or equity vs. equity, similar to forex pairs. Although the concept of such an instrument was not new, it was the first company to launch it.

“Interest since we launched Pairs CFDs has been strong, and we expect demand to keep growing as more brokers understand the simplicity of Pairs and bring this unique product to market for their own clients,” Alexander commented.

“Any initial hesitation around the introduction of Pairs as a new product quickly fades once the simplicity, benefits, and implementation process are clearly laid out—a process we’ve already guided many brokers through,” he added.

“The US 100 vs Japan 225 Has Been the Most Popular”

According to 26 Degrees, these new products provide traders with a simpler and more efficient trading experience than traditional instruments, featuring a single price ratio between the two assets. This ratio adjusts according to changes in the assets’ prices, allowing traders to manage risk through a single trade rather than two separate positions.

Additionally, these Pairs CFDs can be structured to increase or reduce volatility, depending on the instruments' correlation. According to the company, they also offer greater margin efficiency than trading each asset separately with two positions.

Revealing the most popular Pairs, Alexander said: “Among the Indices-focused Pairs, the US 100 vs Japan 225 has been the most popular, while on the Equity CFD Pairs side, Nvidia vs Oracle has attracted the most trader interest. Given the recent volatility in both the Japanese Index and Nvidia over recent months, it is unsurprising that these two Pairs have taken the top spots.”

At launch, the company offered 20 Pairs CFDs. Recently, it added several Gold Pairs against major indices, such as the US 30, US 100, Japan 225, China A50, and US Crude Oil.

“Since we first began discussing Pairs CFDs with clients, we’ve seen strong interest in Gold-related pairs, which has only intensified with Gold’s recent rally,” added Alexander. “We are expecting a lot of interest in the newly released US 100 vs XAU Pair with the upcoming U.S. election, so these rankings may shift in the coming weeks.”

Notably, Gold has consistently been one of the top-traded instruments. Alexander also highlighted that his company is “seeing continued growth in Equity Index volumes globally,” and the new Gold Pairs CFDs will combine these assets.

“The Retail Market in Japan Is Expanding”

Elaborating on the geographical demand for Pairs CFDs, Alexander said: “The Japanese market specifically has shown a keen interest and is a strategic focus for us.” He added: “This is evident with the number of Pairs we offer against the Japan 225 Index and, more recently, the Japan 2000 Index in Osaka.”

“The retail market in Japan is expanding to include a much broader range of instruments and asset classes,” he continued. “Although USD/JPY remains a dominant focus for traders in Japan (much like XAU does globally), we feel that a broader diversification of available instruments is hugely beneficial for both traders and the brokers that serve them.”

“Interestingly, we’ve noticed distinct regional preferences for certain types of Pairs,” he explained. “For instance, Japanese brokers have shown a keen interest in Index CFD Pairs, brokers in APAC have shown a stronger focus on Equity CFD Pairs, and Commodity Pairs, particularly those focused on Oil, are especially popular among brokers in the MENA region.”

Meanwhile, Finance Magnates earlier reported that 26 Degrees is considering to surrender its regulatory license in Cyprus. However, it is planning to keep its Limassol office open as a supporting branch for its international activities.

“Currently, over 20% of our global brokerage client base is either offering or in the process of releasing Pairs CFDs,” said 26 Degrees’ Group Chief Commercial Officer, James Alexander, to Finance Magnates following his company’s recent launch of Gold Pairs CFDs. He added: “That’s a significant number, and we expect it to become even more prominent in 2025 and beyond.”

“We Expect to See Demand Continue to Grow”

Alexander compared the demand for these instruments to the roll-out of Equity CFDs via API in 2017 and 2018. “Back then, very few broker clients offered Equity CFDs; now, the vast majority of major brokers have some form of Equity CFD offering,” he said. “In our opinion, Pairs CFDs will be no different.”

James Alexander, 26 Degrees’ Group Chief Commercial Officer
James Alexander, 26 Degrees’ Group Chief Commercial Officer

26 Degrees, previously known as Invast Global, launched Pairs CFDs last July, enabling the trading of index vs. index, commodity vs. commodity, or equity vs. equity, similar to forex pairs. Although the concept of such an instrument was not new, it was the first company to launch it.

“Interest since we launched Pairs CFDs has been strong, and we expect demand to keep growing as more brokers understand the simplicity of Pairs and bring this unique product to market for their own clients,” Alexander commented.

“Any initial hesitation around the introduction of Pairs as a new product quickly fades once the simplicity, benefits, and implementation process are clearly laid out—a process we’ve already guided many brokers through,” he added.

“The US 100 vs Japan 225 Has Been the Most Popular”

According to 26 Degrees, these new products provide traders with a simpler and more efficient trading experience than traditional instruments, featuring a single price ratio between the two assets. This ratio adjusts according to changes in the assets’ prices, allowing traders to manage risk through a single trade rather than two separate positions.

Additionally, these Pairs CFDs can be structured to increase or reduce volatility, depending on the instruments' correlation. According to the company, they also offer greater margin efficiency than trading each asset separately with two positions.

Revealing the most popular Pairs, Alexander said: “Among the Indices-focused Pairs, the US 100 vs Japan 225 has been the most popular, while on the Equity CFD Pairs side, Nvidia vs Oracle has attracted the most trader interest. Given the recent volatility in both the Japanese Index and Nvidia over recent months, it is unsurprising that these two Pairs have taken the top spots.”

At launch, the company offered 20 Pairs CFDs. Recently, it added several Gold Pairs against major indices, such as the US 30, US 100, Japan 225, China A50, and US Crude Oil.

“Since we first began discussing Pairs CFDs with clients, we’ve seen strong interest in Gold-related pairs, which has only intensified with Gold’s recent rally,” added Alexander. “We are expecting a lot of interest in the newly released US 100 vs XAU Pair with the upcoming U.S. election, so these rankings may shift in the coming weeks.”

Notably, Gold has consistently been one of the top-traded instruments. Alexander also highlighted that his company is “seeing continued growth in Equity Index volumes globally,” and the new Gold Pairs CFDs will combine these assets.

“The Retail Market in Japan Is Expanding”

Elaborating on the geographical demand for Pairs CFDs, Alexander said: “The Japanese market specifically has shown a keen interest and is a strategic focus for us.” He added: “This is evident with the number of Pairs we offer against the Japan 225 Index and, more recently, the Japan 2000 Index in Osaka.”

“The retail market in Japan is expanding to include a much broader range of instruments and asset classes,” he continued. “Although USD/JPY remains a dominant focus for traders in Japan (much like XAU does globally), we feel that a broader diversification of available instruments is hugely beneficial for both traders and the brokers that serve them.”

“Interestingly, we’ve noticed distinct regional preferences for certain types of Pairs,” he explained. “For instance, Japanese brokers have shown a keen interest in Index CFD Pairs, brokers in APAC have shown a stronger focus on Equity CFD Pairs, and Commodity Pairs, particularly those focused on Oil, are especially popular among brokers in the MENA region.”

Meanwhile, Finance Magnates earlier reported that 26 Degrees is considering to surrender its regulatory license in Cyprus. However, it is planning to keep its Limassol office open as a supporting branch for its international activities.

About the Author: Arnab Shome
Arnab Shome
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About the Author: Arnab Shome
Arnab is an electronics engineer-turned-financial editor. He entered the industry covering the cryptocurrency market for Finance Magnates and later expanded his reach to forex as well. He is passionate about the changing regulatory landscape on financial markets and keenly follows the disruptions in the industry with new-age technologies.
  • 6654 Articles
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