As the world of trading continues to evolve, Plus500 (LON:PLUS) is making significant strides towards breaking down barriers for U.S. traders. CFDs are illegal under U.S. Securities Laws, rendering the platform inaccessible to many investors in the country. However, with their recent acquisition of Cunningham Commodities LLC and the development of CTS T4 futures and options trading platform, Plus500 offers customers a range of new products that comply with regulations in the United States, like futures trading.
Plus500 is a global fintech group that offers an array of trading products to traders worldwide. Founded in 2008, the trading platform has gained global popularity for its user-friendly interface and intuitive design. Traders can quickly access a wide range of financial instruments and manage their portfolios effortlessly on the platform.
This comprehensive guide aims to provide U.S. investors with insightful knowledge about Plus500 history, recent acquisitions, earnings potential, and diverse product offerings. Through analytical insights backed by informative data points presented in this guide, readers will be equipped with all the necessary tools needed to make informed decisions when investing with the innovative platform.
Facts About Plus500
- The acquisition of Cunningham Commodities LLC:
In early 2021, Plus500 made a major announcement that it had acquired Cunningham Commodities LLC, a trading platform provider specializing in futures and options speculation. As of July 2021, this acquisition is now complete.
Cunningham’s registration as a Futures Commodity Merchant (FCM) with the US Commodity Futures Trading Commission (CFTC), allows the brokerto now gain legal rights to trade in the U.S. In addition, they are members of two highly respected organizations within derivatives regulatory bodies, the National Futures Association (NFA) and the Chicago Board of Trade (CBOT).
It is important to note that while Plus500 can offer options and futures derivatives through its ownership of Cunningham Commodities LLC, CFDs remain illegal under U.S Securities Laws.
Note: Options offered to U.S. customers by Plus500 are entirely different from options CFDs. Options CFDs are, in fact, CFD products, while the standard options are not. Plus500 continues to ban U.S. traders from accessing CFD products. This will not change unless U.S. laws do.
- Range of Offerings:
As a leading provider of online trading services, Plus500 offers an extensive range of 2800+ assets across multiple asset classes. These include indices, forex, commodities, individual shares, ETFs, options and cryptocurrencies. With such a vast array of offerings available at their fingertips, users have the flexibility to trade in accordance with their unique investment goals.
- New & Emerging Markets, Growing Global Footprint
In FY 2022, Plus500 gained initial access to a new and promising market in Japan through the completion of an acquisition of EZ Invest Securities, a regulated entity. As a result, the company will be able to tap into the substantial Japanese trading market and utilize its technological capabilities and financial strength to establish a strong market position locally. The broker is aggressively focusing on increasing its global footprint. Recently, it obtained a license from the Dubai Financial Services Authority (DFSA) after entering the U.S. and Japan. Furthermore, it gained regulatory licenses in Estonia and Seychelles, holding a dozen regulatory approvals globally.
“We are in an extremely exciting strategic and commercial position, with multiple potential growth opportunities available, particularly in the U.S. futures market, which will continue to drive our growth as a global multi-asset fintech group,” Plus500’s CEO, David Zruia, said. “With further organic investments and targeted acquisitions, we are confident that Plus500 remains well-positioned to deliver sustainable growth over the medium to long-term.”
- Plus500 Invest:
The company launched its proprietary share dealing platform, ‘Plus500 Invest,’ on Android and iOS mobile apps in Europe during FY2022. This new product contributes to expanding the company’s product range and geographic reach, improves customer retention, and further diversifies the revenue base.
- Plus500 Income statement in USD [2018-2022]:
From one year to the next, Plus500 Ltd. experienced revenue growth of 15.85%, increasing from $718.70 million to $832.60 million. Furthermore, its net income also saw improvement, increasing by 19.25% from $310.60 million to $370.40 million.
Gross margin: 92.99%
Net profit margin: 44.49%
Operating margin: 54.10%
Return on assets: 40.42%
Return on equity: 51.38%
Return on investment: 50.85%
- Official sponsor of NBA’s Chicago Bulls:
Plus500 has announced its first-ever sports sponsorship agreement with one of the most iconic NBA professional basketball teams worldwide – the Chicago Bulls. The partnership marks an interconnectivity between finance and sport aimed at driving awareness of the broker’s global presence in the U.S. market.
As part of this four-year deal, Plus500 will be featured exclusively on the front of warm-up shooting shirts and jackets worn by players during games. Additionally, it will have branding rights as an official global online trading partner of the team. This unique collaboration comes at a time when there has been significant growth in interest from investors towards trading platforms over recent years. By adopting its customer-centric approach, Plus500 aims to deliver intuitive and accessible trading products that cater to this audience.
The partnership also includes various marketing initiatives such as community events, and social media content creation among others that aim to drive brand awareness while highlighting both brands’ core synergies; innovation, culture & success. Furthermore, through this sponsorship deal with Chicago Bulls – located at the heart of America’s futures industry where Plus500 already operates – they plan on expanding their clearing capabilities globally by entering new markets while emphasizing their ambitions to develop their footprint within Chicago city itself. To support these efforts further into capturing opportunities within futures markets across North America specifically targeting retail traders plus institutional clients alike; TradeSniper – an intuitive new trading platform designed specifically for these audiences was launched recently along with full clearing membership status granted by CME exchange which serves as compelling evidence showcasing confidence placed upon U.S. futures market prospects by the Plus500 management team.
This groundbreaking partnership between two established brands highlights how digital finance can merge successfully with sports, creating a win-win situation for both parties.
The History of Plus500
Plus500 has come a long way since its inception in 2008. The company started with a Windows-based trading platform, which was later followed by web-based versions for Mac and Linux users. In 2012, it launched an Android-based trading platform, making it accessible to mobile users. However, the road hasn’t been smooth for Plus500. In October 2012, the U.K. subsidiary was fined £205,128 by the FCA for failing to report transactions accurately. Subsequently, in May 2015, the company’s stock value dropped almost 60% due to the freezing of trader accounts ordered by FCA as part of an anti-money-laundering review.
Despite these setbacks, Plus500 went public on the London Stock Exchange in 2013 and continued expanding globally through acquisitions, such as EZ Invest Securities, and Cunningham Commodities LLC/Cunningham Trading Systems LLC. In June 2021, Plus500 opened a new R&D center in Tel Aviv and released its ‘Plus500 Invest’ stock-trading platform with over 2,000 financial trading instruments. The company also made headlines when Kiefer Sutherland was featured as part of its advertising campaign which launched in 2022. And later in September 2022 – they expanded their reach even further launching TradeSniper.
Upon analysis of Plus500’s performance history, it is evident that the platform has demonstrated remarkable resilience, having weathered numerous challenges. However, it is important to note that this resilience was not achieved without some notable hiccups along the way.
Despite these challenges, Plus500 has consistently demonstrated a commitment to innovation, expanding its offerings to traders globally, and establishing a robust position in the competitive trading market. Its success can be attributed in part to the user-friendly interface it offers traders, as well as the efficient trading tools that have made it a popular choice among both seasoned and novice traders.
While there have been occasional setbacks, Plus500’s ability to navigate through them and continue to provide a reliable trading experience is impressive. Its track record of innovation and resilience makes it a platform that should be considered by experienced traders with a comprehensive understanding of the industry.
Financial Highlights 2018 – 2022
|Revenue Growth (%)||65%||51%||146%||18%||16%|
|EBITDA Margin (%)||70%||54%||59%||54%||55%|
|Profit Before Tax||$503m||$189.3m||$523.3m||$386.4m||$474.3m|
|PBT Margin (%)||70%||54%||60%||54%||57%|
|Net Profit Margin (%)||53%||43%||57%||43%||44%|
As per the latest statistics available on the company website, the platform boasts an impressive user base of over 24+ million registered customers worldwide, who conduct transactions exceeding 2 million US dollars every month. It is noteworthy that Plus500 provides support for over 50 different countries, a feature that undoubtedly broadens its customer base. Additionally, Plus500’s presence extends to more than 30 languages worldwide, which is indicative of its global reach.
Regarding revenue growth, Plus500’s financial results for the year ended December 31st, 2022, reflect significant growth, with revenue reaching $832.6 million, a 16% increase from the previous year. The company’s net profit also showed substantial growth, increasing from $310.6 million in 2021 to $370.4 million by December 2022.
Operational Highlights 2022
Plus500 saw a significant increase in its customer base in 2022. According to recent reports, Plus500 now has over 106,549 new customers and more than 280,769 active users. In addition to its impressive user base growth, Plus500 has also achieved several more operational highlights. The platform’s advanced risk management system helps ensure that traders have access to a secure and regulated trading environment. This system includes strict Know Your Customer (KYC) protocols, anti-money laundering (AML) measures, and robust risk management tools that help traders minimize their exposure to market risk.
Plus500’s Annual Revenue
As of March 23rd 2023, Plus500 has published its interim financial results for the twelve months ending December 31, 2022. The company’s revenues amounted to $832.6 million, and the growth of customer income reached $639 million during the same year.
What’s more interesting is that customer trading performance also experienced significant improvement with a total of $193 million compared to just $15.9 million in the previous year – an increase of over ten times. These remarkable figures demonstrate how successful Plus500 has been at attracting high-value customers while improving their overall trading experience. Despite onboarding fewer active accounts than last year, average revenue per user (ARPU) improved significantly by 70%. This can be attributed to high-value customers who have great potential for future revenue growth.
Despite Plus500’s impressive financial performance, there were some challenges faced by the platform in 2022. One notable issue was the nearly double year-over-year increase in average user acquisition cost (AUAC). Specifically, AUAC increased from $877 in FY21 to $1,481 in FY22, indicating a significant rise in the cost of acquiring new users. This increase in AUAC could be attributed to several factors, including rising competition in the online trading industry and increased marketing spending. However, it is noteworthy that despite this increase, Plus500’s overall financial performance did not appear to be significantly affected. The increase in AUAC may be a cause for concern for some traders who may be wondering if this will lead to a rise in trading fees. Nevertheless, Plus500’s commitment to innovation and customer experience, as evidenced by its most recent financial results, suggests that the platform will continue to provide a reliable and competitive trading experience.
And it doesn’t stop there. Plus500 also achieved some record annual levels including total customer deposits which increased slightly year-over-year reaching $2.3 billion and the average deposit per active customer which hit a new annual record level of $8k compared to $5k previously.
Overall, despite adding fewer active accounts than in the previous year and experiencing higher AUAC costs; thanks to its focus on high-value customers and improved trading performance – Plus500 managed yet another year of impressive growth.
Plus500 Earnings 2023
Plus500 has reported another impressive performance, which has driven growth and reinforced its financial position. Plus500 announced an additional $100 million in shareholder returns in February 2023, increasing returns to shareholders in respect of FY 2022 to over $270 million. Furthermore, its net profit in FY 2022 increased by 19% to $370.4 million (FY 2021: $310.6 million) and basic earnings per share increased by 25% to $3.81 million (FY 2021: $3.06 million).
Plus500 H1 2023 Earnings
Plus500 announced on Monday, August 14 it would return $120 million to shareholders through dividends and share buybacks as it looks at further international expansion through acquisitions. The London-listed company posted a 43% slump in core profit in the first half as market volatility declined. However, earnings were up 17% sequentially from the second half of last year.
Plus500 Trading Volumes
Plus500 has seen an impressive surge in its trading volume. According to reports released by the company, the Group generated total revenue in FY2022 of $832.6 million, representing a 16% increase year-on-year (FY 2021: $718.7 million), including revenue of $126.7 million in Q4 2022 (Q4 2021: $161.1 million), with over 294,000 new customers joining during this period.
It’s worth noting that while high trading volumes are generally viewed positively by investors and analysts alike, there are also concerns about potential risks associated with such activity. High levels of volatility can lead to significant losses if not managed correctly. Despite these risks, however, it seems that Plus500 continues on an upward trajectory when it comes to its overall performance and growth prospects within the industry.
Plus500 User Base Growth
With over 24 million registered customers on its platforms since inception, Plus500’s customer base growth is a testament to its success. The company’s ability to attract and retain customers can be attributed to several factors. Firstly, Plus500 offers an intuitive and user-friendly trading experience that caters to both novice and experienced traders. Its advanced trading tools allow users to trade CFDs (Contracts for Difference) on various financial instruments such as stocks, commodities, forex pairs and cryptocurrencies.
Plus500 ensures transparency in all aspects of its operations, from pricing policies to regulatory compliance. The company adheres strictly to regulations set forth by top-tier authorities such as the Financial Conduct Authority (FCA), Australian Securities and Investments Commission (ASIC) and Cyprus Securities Exchange Commission (CySEC).
Plus500 provides excellent customer support services through multiple channels including email support, a live chat facility within the platform itself or via phone calls. This helps in resolving any issues faced by users quickly thereby improving their overall experience with the platform.
All these factors have contributed significantly towards driving the customer base growth for Plus500 over time. As more people discover this reliable online trading platform offering high-quality services at affordable prices coupled with great customer service, it’s no wonder why they continue flocking there.
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