Electronic trading major IG Group Holdings plc (LON:IGG) does not expect the new ASIC rules for the CFD industry to have an impact on certain of its financial targets.

IG notes today’s statement by the Australian Securities and Investments Commission (ASIC) on product intervention measures related to the provision of CFDs.

The measures, which will take effect from 29 March 2021 and apply to retail clients only, are broadly consistent with those proposed by ASIC in its initial consultation. The leverage restrictions, which envisage a leverage cap of 30:1 for trading in CFDs on major currency pairs, are now in line with those already implemented by the European Securities and Markets Authority (ESMA) in August 2018.

These product intervention measures, IG says, do not change the Group’s financial targets of revenue growth in Core Markets of 3-5% over the medium term, and an incremental £100 million of revenue by the end of FY22 relating to the Significant Opportunities portfolio.

Let’s recall that, as per a trading update from September this year, IG’s Q1 FY21 revenue in the Core Markets was £170.8 million, up 56% on the prior year (Q1 FY20: £109.4 million). Performance of the retail client base in UK and Europe was particularly strong, with growth delivered in both revenue per client and number of active clients.

Q1 FY21 revenue in the Significant Opportunities portfolio was £38.2 million, up 94% on the prior year (Q1 FY20: £19.7 million).

Below is IG’s announcement:

IG Group Holdings plc (“IG”, “the Group”, “the Company”), a global leader in online trading, notes that the Australian Securities and Investments Commission (ASIC) has today issued a statement (20-254 MR) following its consultation announced in August 2019 on product intervention measures relating to the provision of CFDs.

The measures, which will take effect from 29 March 2021 and apply to retail clients only, are broadly consistent with those proposed by ASIC in its initial consultation. The leverage restrictions are now in line with those already implemented by the European Securities and Markets Authority in August 2018.

As previously guided, these measures do not change the Group’s financial targets of revenue growth in Core Markets of 3-5% over the medium term, and an incremental £100 million of revenue by the end of FY22 relating to the Significant Opportunities portfolio.

IG has a strong track record of working constructively with its regulators and adapting to regulatory change. The Group’s continued ability to adapt to the pace and direction of evolving regulation is a long-term success factor.