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    ActivTrades Revenue Down 45% in 2H-2020

    Abstract:London based Retail FX and CFDs broker ActivTrades has seen a severe decline in activity during the second half of 2020, with revenues down by 45% from 1H-2020 and the company operating at roughly a breakeven level.
    ActivTrades-expo-booth.jpg

      London based Retail FX and CFDs broker ActivTrades has seen a severe decline in activity during the second half of 2020, with revenues down by 45% from 1H-2020 and the company operating at roughly a breakeven level.

      ActivTrades had – like many online brokers – a record first half of the year in terms of both revenues and profits, with much of the action coming in late Q1 at the outset of the global COVID pandemic. Wild market volatility across both currencies and equities in late February and throughout March 2020 led to record trading volumes (and revenues and profits) at many brokers. However at ActivTrades that didnt carry over into the second half of 2020.

      To the numbers… as we reported last summer ActivTrades brought in £30 million in revenue in the first six months of 2020 – more than it had in all of 2019 which management admitted saw “very poor results” – with record profit of £18 million. However in the second half of 2020 revenues were down 45% to £16.5 million, and net profit was less than £800,000, with the company operating at fairly close to breakeven.

      ActivTrades did get some bad press around the middle of 2020, when the company lost a UK employment tribunal hearing regarding the dismissal of the companys former Compliance Officer, Lana Sinelnikova. The tribunal found ActivTrades guilty of victimizing Ms. Sinelnikova after she accused the company of sex discrimination and blew the whistle on what she believed were potentially criminal practices at the firm. In 2017, Ms. Sinelnikova issued a grievance against the company which was also sent to the FCA, accusing ActivTrades of sex discrimination and potential criminal offences relating to their compliance with financial conduct laws.

      In her complaint, she recalled an incident at the firm‘s Sofia, Bulgaria office when “[CEO Alex] Pusco stated that ’women should stay at home and cook‘, in the context of complaining about the length of maternity leave in Bulgaria.” She also claimed that Mr. Pusco displayed an image of an advertisement by Aston Martin for used cars. The ad contained a picture of a woman wearing limited clothing in a particular pose. On showing this advert to Ms. Sinelnikova and others at the company’s London office, Mr. Pusco stated that marketing needed to be “sexy” and that “sex sells”.

      The tribunal found the ad to be ‘insulting, offensive, and degrading to women’. But it stopped short of supporting Ms. Sinelnikova‘s claim for direct sex discrimination, although it did uphold her claims of unfair dismissal, awarding her a total of £76,510 plus reimbursement of 65% of her legal costs. While the size of the award was not huge, the incident did generate some bad press for the company. We don’t know if that incident was partly responsible for the downturn in ActivTrades fortunes in the second half of 2020.

      Trading volumes at ActivTrades averaged $58 billion monthly in 2020, up 25% over 2019. Again, we believe that most if not all of the increase in volumes came thanks to outsized activity in February-March-April 2020.

      ActivTrades is controlled by its longtime CEO, Swiss national and Monaco resident Alex Pusco.

      ActivTrades income statement and balance sheet for the full year 2020 follow:

    ActivTrades-income-statement-2020.png
    ActivTrades-balance-sheet-2020.png
    分割线2.png

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