Introducing-Brokers-Where-to-go-after-ESMA.

So lets take a step back… to a time pre ESMA, pre MIFID II, an environment for traders where the sky was always blue, the sun was always shining and brokers offered golden handshakes just for signing up as an IB. As an Introducing Broker you could be paid a split of all client commissions plus some could also get paid on their clients cash deposits and you didn’t need to do a thing for it but introduce the client.  The market offered huge leverage allowing for high commissions and therefore sizeable commission splits went to the IB’s. Life was good.

Fast forward to early 2018 with the introduction of MIFID II, and EU brokers have more stringent requirements for submitting financials, transparency of profits, providing best execution and more, ultimately resulting in tighter spreads. The IB therefore has a lot less scope for profit. Brokers can’t entice IBs with ongoing commission splits unless that IB goes through the process of continually providing additional services and then needs conditional approval, their only option is to offer to pay a small introduction fee as a one off which likely isn’t a sustainable living for an IB.

“You would think that this might be the end of the story but from every problem comes a solution…”

Now we get to August 2018 and ESMA’s margin changes are thrust upon the industry, less margin, therefore less potential profit, less trading and therefore less commission generated. This is potentially the death knell for any IB that was still able to make a living even after MIFID. There is very little left for the IB or the client to work with if they are either from the UK/Europe or using a UK/European broker.

You would think that this might be the end of the story but from every problem comes a solution. Tradeview continues to expand with its improved product offering, 24 hour client service, pushing a reinvestment into technology and offering the cheapest spreads on many instruments. Bitcoin is still being offered at less than a ten cent spread.

They can still offer margins of 200 or 400 to 1 so that clients can trade with freedom and the IB doesn’t need to prove themselves worthy in the eyes of MIFID so can focus on generating leads and creating a business model with less restriction and more options for their clients.

Related: The ESMA and Its New Regulations
Related: Will MIFID II Drive Business Away from Europe?

For many IB’s who haven’t yet heard of Tradeview this is the time machine back to those days of blue skies and sunshine. An option for you to drive business and reap the rewards without the recent regulatory restrictions. So if you are an Introducing Broker with a thousand clients, a Master IB looking for a new home or were just looking to start with a handful of traders then this is the online broker you were looking for. Tradeview have hundreds of IB’s of all sizes from across the globe who have put their trust into a long-standing broker who puts their clients first and offers them the best trading conditions. Once signed up the IB can receive free assistance with marketing material and web design as well!

To find out more about signing up as an IB or how you could start to make a living as an Introducing Broker please click here or feel free to contact me on the below details.

Click here or contact me for more info !

Adam Saward

 

Adam Saward
Head of UK Business Development
asaward@tvmarkets.com