The global algorithmic trading firm, XTX Markets, recorded a massive leap in net profit from its UK entities during the fiscal year 2022, Finance Magnates has learnt. The profit reached £1.095 billion last year, jumping 64% from £667 million in 2021.

XTX Grows in the UK despite Tough Market

During the last year, XTX’s revenue from its UK operations climbed 68% from £1.477 billion in the prior year to £2.485 billion. The latest figures detail XTX Markets Technologies Limited and its two primary revenue generators in the UK: XTX Markets Ltd and XTX Markets Trading Ltd.

XTX achieved the recent growth in its UK business amid interest rate increases by central banks and higher volatility in the commodity markets triggered by Russia’s war on Ukraine. The UK subsidiaries in their combined performance returned significant gains despite the fact that the UK equity market ended 2022 with only a modest gain.

Specifically, the FTSE 100 Index, which is a benchmark that tracks the 100 largest companies listed on the London Stock Exchange, reported a marginal gain of 0.9% in 2022. On the contrary, Stoxx 500 Index, a Pan-European benchmark, shrank 12.4% followed by Germany’s DAX which dropped 12.3%.

Meanwhile, XTX’s rival, Citadel Securities, reported that its market-making arm generated a record $7.5 billion in revenue last year. The figure jumped 7% from $7 billion in the previous year, according to Bloomberg.

On the contrary, Virtu Financial saw its net profit slump by almost half in 2022: the figure dived 43% from $827.2 million in 2021 to $468.3 million, Finance Magnates reported. Additionally, the electronic market maker reported lower revenues and net trading income in 2022 compared to the prior year.

A Market Leader

As an electronic market marker, XTX provides liquidity across a range of asset classes, including equities, FX, and fixed income. On top of that, the company offers its clients over-the-counter liquidity across forex and metals products.

In late 2018, XTX launched its Systematic Internaliser (SI) for European cash equities, providing off-exchange liquidity to market participants. In the subsequent year, it became the largest SI in Europe, overtaking Citadel Securities and Tower Research.

XTX is also one of the biggest liquidity providers globally. As of mid-2022, the company accounted for 18% of all passive trading in European equities. This practice involves the buying and selling of shares that are not aimed at profit-making from short-term price movements.

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