LeapRate's Daily Forex Industry Newsletter
Join now to receive first access to our EXCLUSIVE reports and updates.
Screenshot of a breaking news alert e-mail from Q2 2017
LeapRate Exclusive… LeapRate has learned that in the wake of the problems being experienced by retail forex and CFD broker Plus500 Ltd (LON:PLUS), where clients of Plus500 UK remain frozen out of their accounts and unable to deposit, withdraw, or trade, several leading UK online brokers are making a play to fill the void being felt by affiliates of Plus500.
Affiliates – who advertise on behalf of a broker and are then paid a commission on either a ‘CPA’ (Cost Per Acquisition for each new client signed up) or Revenue-Share basis – are often the lifeblood of a broker, providing in certain cases more than half of new customer acquisitions to forex brokers.
In Plus500’s case, we believe that affiliates are actually less important, accounting for about 15% of new customers to the company (based on data from Plus500’s IPO prospectus last year). But in any event, affiliates remain important for the company, especially in the lucrative UK market, where Plus500 is experiencing its problems.
We understand that Plus500 is still engaged with its affiliates, sending inbound traffic to its regulated Cyprus subsidiary Plus500 CY. However certain affiliates (and clients) prefer an FCA-regulated entity.
The two main pushes we have seen have been from industry-leading brokers IG Group Holdings plc (LON:IGG), and ETX Capital. IG Group has been spending about six months preparing its new Affiliate program, but apparently has decided to speed things up given the opportunity provided by Plus500 affiliates now with (at least temporarily) looking to send their traffic to a new home.
ETX Capital, which recently purchased the Alpari UK client list and is till busy trying to provide ex Alpari UK clients with a new home they can feel comfortable with, has been circulating a cleverly worded email among Forex affiliates entitled ‘ETX offers a generous bonus of $500plus‘. From the ETX mailer:
IG Group expects to launch a targeted affiliate offering within the next few weeks. IG has commenced pre-registration of interested partners via email at [email protected]
IG is a global leader in online trading, providing fast and flexible access to over 10,000 financial markets – including shares, indices, forex, commodities and binaries.
Established in 1974 as the world’s first financial spread betting firm, IG’s aim is to become the default choice for active traders globally. It is already an award-winning multi-platform trading company, the world’s No.1 provider of CFDs* and a global leader in forex, and it launched an execution-only stockbroking service in the UK and Ireland in September 2014.
It is a member of the FTSE 250, with offices across Europe, Africa, Asia-Pacific and the US, where it offers limited risk derivatives contracts via the Nadex brand.
*Based on revenue excluding FX, published financial statements, July 2014.
For its part, Plus500 is making something of a comeback today, with its shares trading up more than 21% as of the time of writing to £3.00. Recall, however, that they began last week at £7.50.