IMC posts record profits

3 comments / April 18, 2015

imcIMC Financial Markets posted record profits of €165 million over 2014. That’s 30% more than the previous year. Especially the last four months of 2014 have been very good, according to Rob Defares in FD (nl, paywall). The trading revenue was 17% higher with €474 million.

Sharp growth since 2009

An annual profit of €165 million is a lot. To put in in perspective, only a few years ago the profits were €28m (2008) and €26m (2009). Since 2009 the results have shown a structural growth. We still have to wait for Optiver to release their earnings, but it’s reasonable to expect Optiver to beat IMC and report a profit in excess of €200 million.

shrinking headcount

The profits go up, but the number of employees go down. On the other hand, IMC employs a lot of people compared with Virtu (151). Headcount was down from 619 to 581. The firm has bought Goldman Sach’s trading operations on the floor of NYSE – bringing in some dozen Goldman Sachs traders. This suggests a few more employees have been shown the door (apart from the obvious 38). Offices are in Sydney, Hongkong, Zug, Amsterdam, New York, Chicago and Shanghai.

Average bonus €180k

The bonus percentage at trading firms like IMC is approximately 35%. When the total profit after tax is €165m, there’s probably a 15% corporate tax applied. With this information we can estimate the profit before bonus and taxes to be €300m. This suggests the bonus to be €105m, or per employee on average €180k on top of their salary. Nice.

However, the bonus pay out is usually very skewed at IMC. Most of the cookie jar will end up in the management ranks. As seen before in the Chicago details.

Happy Flow Traders

Flow Traders is preparing their IPO. This kind of results are helping them a lot selling the shares to investors. Not only the profitability, but also the sharp growth rate will get investors interested. IMC isn’t interested in going public. But if they would, it would be quite a price tag for the firm.

Freaking out

If you’re trying to land a job at a firm like IMC. A small piece of advice. For Andreas it has been too late, but if you’re freaking out because of an interview with an IMC recruiter : try yoga. Maybe Tim van der Vliet could help you. But posting this kind of questions on the internet isn’t going to help you. Maybe hard to believe, but really : those IMC recruiters have google as well.

A sinking HiQ and 80%

18 comments / April 13, 2015

Sinking HiQSmall post on the sisters HiQ Invest and DeGiro – both independent of each other but having the same parent company.

The sinking HiQ

First of all the hedge fund HiQ Invest. Founded by some former AOT traders, they received pretty good press after performing nicely in the first few years. Especially while carrying very low assets under management, some good returns have been reported (2009 in particular was good). Even won some awards a few years ago. At least they still have the pictures.

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Euronext loses derivatives market

6 comments / April 8, 2015

Lekker dobbelenThe old exchange Euronext has been releasing monthly turnover statistics every month. This year the number of transactions in the equity market has seen a sharp rise compared with first quarter of 2014. Euronext reported a rise of 29% in traded value.

It’s a bull market, so the same number of shares traded represent a higher value. At the same time there’s more action in the market, the increased value of traded stocks is a result of both variables. Last month the average daily transaction value (ADV) was €9100 million. To be clear, that’s for all Euronext cash markets (Lisbon, Brussels, Paris and Amsterdam).

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Doubts on Flow Traders’ IPO

16 comments / April 8, 2015

IPOFlow Traders has been telling the press their IPO is planned this year “before the summer” and at Euronext Amsterdam. The Telegraaf has been reporting this last weekend (blendle – nl).

It was also the only relevant piece of information, because the journalists have a very hard time understanding what the Flow Traders is actually doing. Not all their fault, as Flow has been posing as a true high frequency trading gem – and they are not. Comparing the business with a racing team (“the car is the IT and connections, the driver is the trader”) seems to be coming straight from Flow’s marketing department (or IPO underwriting investment bank).

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Markets halt after Euronext upgrades router

13 comments / March 31, 2015

Broke-214x300The engines at Euronext have a reputation comparable with French cars. Unreliable and panne at the worst thinkable moments. In the past years the triple witching hours have been most likely to see trading halts. Recently the market shut down on December 15th and November 27th – but this year we did not experience any trouble. A whole quarter without glitches.

Until last weekend’s system upgrade

Last weekend, the system engineers at Euronext decided it was a good moment for upgrade a router. Monday morning, the derivative markets at Euronext suddenly started to experience trouble shortly after the opening. A short while markets remained operating at half speed with half of the participants in the dark. Ten minutes later the exchange was forced to close the doors.

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