GAIN Capital

GAIN Capital is a US-based provider of online trading services, headquartered in Bedminster, New Jersey.[1] The company provides market access and trade execution services in foreign exchange, contracts for difference (CFDs) and exchange-based products to retail and institutional investors. Trading is provided via one of two electronic trading platforms, its own proprietary FOREXTrader PRO, or MetaTrader 4. GAIN Capital allows retail and institutional clients to speculate on global foreign exchange markets in what is known as ‘margin forex trading’.

GAIN Capital Holdings, Inc.
TypePublic
NYSE: GCAP
Russell 2000 Component
IndustryFinancial Services
Founded1999 (1999)
Headquarters
Bedminster, New Jersey
,
United States
Key people
Glenn Stevens CEO
ServicesFinancial broker, On-line forex trading
Number of employees
800+ [1]
Websitewww.gaincapital.com

GAIN Capital operates retail foreign exchange and CFD trading brands, FOREX.com and City Index as well as GTX, a fully independent FX ECN, a multi-dealer foreign exchange trading platform, for hedge funds and institutions.[2] It also owns advisory CFD business, SALT Invest, and futures provider, Daniels Trading.[3]

History

GAIN Capital was founded in 1999 in Bedminster, New Jersey, and was one of the early developers of on-line forex trading.

The company went public in 2010 when it floated part of its shareholdings on the NYSE; however, the initial IPO was scaled back at the last minute as the target price was not reached.[4]

In October 2014 the company acquired UK-based rival City Index for $118 million, boosting its CFD business and expanding its Forex business in the UK.[5]

On February 7, 2017, GAIN Capital agreed to acquire FXCM's US client base a day after the latter had been barred by the CFTC and NFA from doing business in the United States.[6] The company paid $7.2 million for these accounts, $500 per account that traded within 76 days and $250 for accounts that traded subsequently.[7]

In February 2020, INTL FCStone announced the acquisition of US-based brokerage GAIN Capital Holdings Inc. The all-cash deal, approved by boards of both companies, was worth about $236 million in equity value.[8][9]

Operations

GAIN Capital is a US-based firm but has serviced customers from over 140 countries worldwide and gains over half its revenue from outside the US. GAIN Capital and its affiliates have offices in New York City; Bedminster, New Jersey; London; Sydney; Hong Kong; Tokyo; Singapore and Seoul. The company's largest retail Forex website is Forex.com, though it also offers white label solutions for dozens of online Forex trading companies, most of which serve the global market.[10]

Regulatory issues

In May 2008 it was told by the Chinese financial regulator, China Banking Regulatory Commission that it had breached rules that prohibit forex trading firms providing retail forex trading services through direct solicitation to Chinese residents through the internet without a permit. It temporarily stopped taking Chinese clients between 2008 and 2010.[11]

In October 2010, Gain Capital was fined by the National Futures Association for allegedly engaging in margin, liquidation and price slippage practices that benefited Gain to the detriment of its customers. They were fined $459,000 and agreed to refund to customers the amount of negative slippage they experienced on the trades that were placed in their accounts between May 1 and July 31.[12][13]

References
  1. "About Gain Capital". gaincapital.com. Retrieved 12 October 2015.
  2. "About GTX". gaingtx.com. Retrieved 12 October 2015.
  3. "GAIN Capital expands futures business with purchase of majority interest in global asset advisors and Top Third AG Marketing". marketwatch.com. Retrieved 12 March 2014.
  4. "Gain Capital (Forex.com) goes public with IPO, price below range". December 15, 2010. Retrieved 21 December 2010.
  5. "Spencer sells City Index to GAIN Capital". Financial Times. October 31, 2014.
  6. "Gain Capital finalizes acquisition of FXCM's US clients". LeapRate. 2017-02-07. Retrieved 2017-02-07.
  7. "GAIN Capital puts sum paid for FXCM US client accounts at $7.2m at end of Q3'2017". FinanceFeeds. November 9, 2017.
  8. "INTL FCStone to Acquire GAIN Capital in All-Cash Deal". Finance Magnates | Financial and business news. 2020-02-27. Retrieved 2020-07-31.
  9. Inc, INTL FCStone (2020-02-27). "INTL FCStone Inc. Agrees to an All-cash Acquisition of GAIN Capital Holdings, Inc. at $6.00 Per Share". GlobeNewswire News Room. Retrieved 2020-07-31.
  10. "Gain Capital Successfully Transfers Former FXCM U.S. Retail Customers To FOREX.com". PR Newswire. February 27, 2017.
  11. "GAIN Capital: Regulatory Problems Affect Revenue, Margins". seekingalpha.com. December 15, 2010. Retrieved 21 December 2010.
  12. "NFA Sanctions Gain Capital $459,000". Futuresmag.com. 28 November 2010.
  13. "Case Summary - Gain Capital LLC - NFA 10BCC00015 - NFA ID: 0339826". NFA. November 11, 2010.
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