Company type | Public |
---|---|
Industry | Online trading |
Founded | 2008 |
Headquarters | |
Key people |
|
Services | Online trading platform |
Revenue | US$ 726.2 million (2023) [2] |
US$ $336.4 million (2023) [2] | |
US$ $271.4 million (2023) [2] | |
Website | plus500 |
Plus500 is an Israeli-founded London-based firm that provides online trading services in contracts for difference (CFDs), share dealing, futures trading and options on futures. The company has subsidiaries in the UK, Cyprus, Australia, Israel, Seychelles, Singapore, Bulgaria, Estonia, the United States, Dubai, Indonesia, the Bahamas and Japan. It is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index.
The company was founded in 2008 by six alumni of the Technion – Alon Gonen, Gal Haber, Elad Ben-Izhak, Omer Elazari, Shimon Sofer, and Shlomin Weizmann – with an initial investment of $400,000. [3] [4] [5]
Plus500 first launched a Windows-based platform. A web version followed in 2010, with iOS and Android apps launching in 2011 and 2012, respectively. By Q1 2013, 40% of transactions were conducted via mobile devices. [3]
In October 2012, Plus500UK Ltd. was fined £205,128 by the UK's Financial Conduct Authority (FCA) for inaccurate transaction reporting between June 2010 and November 2011, impacting 1,332,000 transactions, of which 189,000 went unreported. [6] [7] Operating with a high-automation, low-staff model (40 employees in 2013, growing to 80 by 2015 in Tel Aviv), Plus500 lacked adequate systems, documented procedures, and staff training to ensure compliance. [8] [9]
In 2013, Plus500 went public on the Alternative Investment Market of the London Stock Exchange with a market cap of $202 million. [10] [11] [3] By mid-2013, Plus500's website operated in 51 countries across 30 languages, offering over 1,800 assets. [3] The company launched its Windows Store app in 2014. [12]
In 2014, co-founder Shimon Sofer sold 1.5 million shares for an estimated £4.1 million, causing an 8.7% drop in the share price. [13]
In May 2015, Plus500UK faced a major crisis when the FCA ordered a freeze on all UK accounts as part of an anti-money-laundering review. [14] Unlike traditional brokers, Plus500 allowed customers to start trading with minimal verification and required complete documentation only upon withdrawal, even enabling account creation through Facebook. [15] [16] The account freeze halved Plus500's market value, dropping its share price from £860 million to £459.6 million. [17] [18] During this crisis, Plus500's management agreed to sell the company to Playtech, an online gambling company that was expanding into trading, for $703 million, roughly half its pre-freeze valuation. However, in November 2015, Playtech withdrew after failing to secure regulatory approval. [19] [20] Following the FCA issues, 72% of affected UK clients resumed trading, though Q2 2015 revenue still declined by 47.5% to $43 million. [21]
In January 2016, Plus500UK resumed onboarding new customers in the UK. [22] In the same year, Plus500IL Ltd., the company's Israeli subsidiary, received a Trading Arena Licence from the Israel Securities Authority (ISA). In September, Plus500 launched an Apple Watch app to trade and view account details. [23]
In the fall of 2016, Plus500's founders sold 13% of the company's shares, raising £100.75 million but causing a 16% stock drop. They retained a 22% stake. [24]
In December 2017, Plus500's Singapore subsidiary, Plus500SG Pte Ltd., obtained a Capital Markets Services license from the Monetary Authority of Singapore (MAS) to trade in securities and leveraged forex. [25]
In June 2018, Plus500 launched an Economic Calendar, providing global financial events and indicators in partnership with Dow Jones & Company, along with a list of impacted instruments per event. [26] That same month, shares of Plus500 were listed in the main market of the London Stock Exchange, and the company joined the FTSE 250 Index of leading mid-cap firms. [27] [28] By 2018, Plus500's trading apps supported 32 languages, including English, German, Italian, Spanish, French, Arabic, and Chinese. [29] By the end of 2018, Plus500 reported a 33% increase in revenue, reaching $437.2 million (£314.7 million) compared to $327.9 million in the previous year. Net profit rose by 70% to $199.7 million. [30]
In 2021, Plus500 appointed Jacob A. Frenkel, former chairman of JP MorganChase International and former governor of the Bank of Israel, as chairman. [31] the company announced its agreement to acquire Cunningham Commodities LLC and Cunningham Trading Systems LLC, finalizing the acquisition by July as part of its expansion into the U.S. futures market. [32] [33]
During the summer of 2021, Plus500 opened a new R&D center in Tel Aviv [9] and introduced "Plus500 Invest," a stock-trading platform featuring over 2,000 instruments. [34] By the third quarter of 2021, the company reported having 166,310 active clients [35]
In March 2022, Plus500 acquired Japan-based EZ Invest Securities, specializing in securities and derivatives trading. [36] Later, in September, it launched TradeSniper, a futures trading app for U.S. retail clients. [37]
In August 2024, Plus500 announced plans to return $185.5 million to shareholders through a $110 million share buyback and $75.5 million in dividends. The company benefited from global volatility driven by events like the Covid-19 pandemic, 2022 Russian Invasion of Ukraine, and a conflict in Gaza since 7 October 2023 and expects to benefit from the U.S. elections in November 2024. Plus 500 also intends to focus on expanding into the U.S., UAE, and Japanese markets. [38] [39]
Plus500 operates under various regulatory authorities worldwide. Plus500UK Ltd. is regulated by the FCA (FRN 509909); [40] Plus500CY Ltd. by the CySEC (No. 250/14); [41] Plus500AU Pty Ltd. by the ASIC (AFSL #417727), [42] and also authorized by New Zealand's FMA (FSP No. 486026) [43] and South Africa's FSCA (#47546). [44] Plus500IL Ltd. is authorized by the ISA, [45] Plus500SEY Ltd. by the Seychelles FSA (No. SD039), [46] Plus500SG Pte Ltd. by MAS (License No. CMS100648-1), [47] Plus500EE AS by the Estonian Financial Supervisory Authority (No. 4.1-1/18), [48] Plus500AE Ltd by the Dubai DFSA (F005651), [49] Plus500JP Securities Ltd. by Japan's FSA (No. 156), [50] and Plus500BHS Ltd. by the Bahamas' SCB (SIA-F250). [51]
Plus500 has faced numerous complaints over platform failures and questionable practices, with reports of clients wrongly accused of market abuse and profitable trades canceled. [52]
In February 2019, The Times highlighted discrepancies in Plus500's financial reporting. While the company's 2017 Annual Report stated it had no net revenues or losses from market P&L in 2015-2017, a later report revealed a $103 million loss from client trading activity in 2017. [53]
In October 2017, several hundred former clients filed a lawsuit against Plus500, accusing the broker of failing to manage their money adequately. In addition, the broker's platform operated with numerous failures, due to which clients were often unable to close positions when they wanted to. [54]
In April 2017, Plus500 paid a €550,000 fine to Belgium's FSMA for offering CFDs without the required prospectus and failing to submit ads to the regulator. Although Plus500 denied any wrongdoing, it complied with FSMA's demand to close its Belgian website and inform Belgian clients of the issue, offering free account closures. [55]
In 2021, the Tel Aviv District Court approved a $29 million class action against Plus500 Israel. It was alleged that during the Brexit referendum's volatile aftermath, Plus500 restricted trading in put options for 90 minutes, selectively allowing call options, to prevent customer profits. [56] [57] [58]
On 14 September 2023, a second class action was filed in Australia, alleging that Plus500 engaged in misleading and unconscionable conduct by selling high-risk investments that led clients to financial losses from November 2017 to March 2021. [59] [60] [61]
Plus500 distinguishes itself from traditional brokers through an affiliate marketing model and significant investment in web advertising — over £48 million in 2014 alone — targeting potential clients on platforms like Facebook and Instagram. Aiming to attract beginner traders, Plus500 simplified its marketing materials, while many competitors require tests and offer educational seminars. [17]
In 2015, Plus500 signed a sponsorship deal with Atlético de Madrid, becoming its main sponsor until 2022. [62] Later that year, Plus500 became the club's main sponsor and kept that title for the next 7 years until June 2022. [63] The company expanded its sports sponsorships in 2016 with the ACT Brumbies of Super Rugby, [64] in 2020, signed with three football clubs: Swiss Super League champions Young Boys, [65] Poland's champions Legia Warsaw, [66] and Serie A club Atalanta. [67] In 2023 beIN Sports blacked out Atalanta and Young Boys broadcasts due restrictions on CFD advertising by the Autorité des marchés financiers (AMF) [68]
In 2022, Plus500 entered a multi-year partnership with the NBA's Chicago Bulls [69] and launched an advertising campaign featuring actor Kiefer Sutherland in the United Kingdom, Italy, the Netherlands, Germany, and Australia. [70]
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