Plus500 reported lower-than-expected sales and swung to a loss in 2021 as volatility subsides. Despite profits decline, the broker managed to get new license.
Plus500's annual financial report for 2021 shows a decline after its trading volume had skyrocketed during the pandemic due to high volatility. However, as volatility subsides, client interest in trading also weakens.
David Zruia, CEO of Plus500, said that volatility is good because whenever there is volatility, there is an interest from clients to trade.
"We wish peace. However, we are enjoying the volatility that all this news is fueling. History shows that always extraordinary global events, invasions, wars, usually lead to higher volatility," he added.
The decline did not only occur in revenue. Profit before tax also decreased to $386.4 million from $523.3 million in 2020. In addition, the number of new clients also shrank to 196,336 (approximately 30%). However, despite a decrease in profits, Pluss500 announced a $55 million share buyback.
New Regulatory License
Meanwhile, Plus500 has successfully secured a new license in 2022 from the Financial Supervisory Authority (FSA) to operate as an investment company in Estonia.
On February 7th, Finantsinspektsioon issued an authorization to Plus500 to provide Estonian traders with various investment and additional services. Later, the company has the right to receive and send securities orders, execute securities orders on behalf of clients or on its own behalf, and trade securities on its own accounts.