(Adds details on the effect of ESMA ruling)
July 2 (Reuters) - Online trading platform Plus500 Ltd said on Monday it has materially increased its full-year financial performance expectations, after geopolitical events including U.S. import tariffs resulted in higher levels of market volatility in the second quarter.
“Despite more normal trading conditions, we continue to benefit from new customers acquired over recent periods trading a wide range of instruments,” CEO Asaf Elimelech said in a statement.
The Israel-based company had raised its 2018 expectations in June, saying it benefited from volatility in the markets and high levels of trading in its cryptocurrency offering.
Following recent regulatory changes implemented by the European Union’s securities watchdog, Plus500 said 12 percent of its clients could be eligible for an “elective professional client” (EPC) status.
“Group’s EPC offering puts it in a strong position to maintain revenue from those customers ... performance could be impacted by the rate at which customers request to be reclassified, and are accepted, as elective professional clients,” Plus500 said.
The European Securities and Markets Authority (ESMA) said in March that it would ban ‘binary’ options sales to retail clients and restrict the sales of Contract for Differences (CFDs) to protect investors from significant losses.
Binary options and CFDs are financial products that give an investor exposure to price movements in securities without actually owning the underlying assets such as a currency, commodity or stock. (Reporting by Noor Zainab Hussain in Bengaluru; Editing by Amrutha Gayathri)