Irish spread trading firm makes €4m turnover


3 Dec 2003

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Irish internet-based spread trading financial institution Global Trader 247 has made a turnover of €4m after winning business in the Irish, Canadian and South African financial markets and has now set its sights on the Far East.

Global Trader 247 was established over three years ago in South Africa by Trinity College graduate David Butler with colleagues in the investment banking community. The company is profiting from an unprecedented rise in spread trading, where punters go online and invest in the performance of a share, a currency or a commodity without owning the shares themselves. The website has been growing 60pc quarter-on-quarter and the company, which employs 32 people, recently established its European hub in Dublin where it currently employs seven people. The company employs a further four people in Toronto.

According to Butler, the site now executes approximately 1,500 trades a day, on average 30,000 a month, with transactions worth close to €200m. The company raised €2.8m worth of venture capital over a year ago.

“We now have a turnover of €4m a year and have a significant profit margin on the business,” Butler told siliconrepublic.com.

“On a good day, approximately 5pc of the Johannesburg Stock Exchange use it for trading and that’s the 10th biggest stock exchange in the world,” Butler added.

Earlier this year the company forged a €630,000 joint venture with Canada’s biggest bond broker Shorcan to specialise in the sale of contracts for difference (CFD) segment of the financial services industry, which will allow punters to profit from the performance of a share even though the value of the share price is falling. The trader is engaging effectively in the performance of the share and not the share itself and there is no stamp duty, broker fee or administration fee involved.

In recent weeks Global Trader 247 also switched to a new trading platform that allows the company to perform a trade within half a second. It has shifted from a 100pc Microsoft platform to a combination of Sun’s J2EE platform and Microsoft’s 2000 operating and database platforms.

The trading platform is packed with a host of valuable trading facilities that includes everything from ‘order entry’ and ‘trade execution’ to ‘real time portfolio valuation’ and the automatic risk management services of ‘take profit’, ‘stop loss’ and ‘trailing stops’. Clients can have accounts in euro, US dollars, Canadian dollars, sterling or rands and can trade commodities, currencies, equities and indices.

The applet-based trading platform caters for high volumes of simultaneous user interaction and transaction. Socket technology ‘listens’ for any new prices and acts accordingly in determining whether orders should be executed into trades, stops moved or open positions closed out. All trades are communicated in real time to Global Trader 247s risk management system located on servers in its Dublin office. Global Trader 247 then replicates these risk management services to other centres around the world ensuring that each office is able evaluate and manage their appropriate risk.

The system has been designed to limit database access with all transactions, thus improving all aspects of performance considerably. Reduced server access provides clients with faster response times. The applet uses security certificates, which provide a secure and trusted channel for clients to trade across. The applet receives real-time prices from Global Trader 247’s centralised market making pricing server.

All information is channelled from the applet through Java’s Servelet technology to the servers. The servers validate all trades according to Global Trader 247s business rules and commit the transaction to a Microsoft SQL Server database. The database has a transaction audit trail that provides easy and accurate accountability for all processed trades.

By John Kennedy