XTX’s Profit from UK Operations Surges above £1 Billion in 2022

Republished By Plato

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Global
algorithmic trading firm, XTX Markets, recorded a massive leap in net profit
from its UK entities during fiscal year 2022, Finance Magnates has learnt. The
profit reached £1.095 billion last year, jumping 64% from £667 million in
2021.

During the recent year, XTX’s
revenue from its UK operations also climbed by 68% from
£1.477 billion in the prior year to £2.485 billion. The latest figures are
for XTX Markets Technologies Limited and its two primary revenue generators
in the UK: XTX Markets Ltd and XTX Markets Trading Ltd.

XTX
achieved the recent growth in
its UK business amid interest rate increases by central banks and higher
volatility in the commodity markets triggered by Russia’s war on Ukraine. The UK subsidiaries
in their combined performances also returned significant gains
despite the fact that the UK equity market ended 2022 with only a modest
gain.

Specifically,
the FTSE 100 Index, a benchmark that tracks the 100 largest companies listed on
the London Stock Exchange, reported a marginal 0.9% gain for 2022. On the
contrary, Stoxx 500 Index, a Pan-European benchmark, shrank by 12.4% followed
by Germany’s DAX which dropped by 12.3%.

Meanwhile, XTX’s rival, Citadel
Securities, reported that its market-making arm generated a record $7.5 billion
in revenue last year. The figure jumped by 7% from $7 billion in the
previous year, according to Bloomberg.

On the
contrary, Virtu Financial saw its net profit slump by
almost half in 2022: the figure
went down by 43% from $827.2 million in 2021 to $468.3 million, Finance
Magnates reported. Additionally, the electronic market maker reported lower
revenues and net trading income in 2022 compared to the
prior year.

A Market
Leader

As an electronic market marker, XTX provides liquidity across a
range of
asset classes, including equities, FX, and fixed income. The company also offers its clients over-the-counter liquidity across forex
and metals products.

In late
2018, XTX launched its Systematic Internaliser (SI) for European cash equities,
providing off-exchange liquidity to market participants. In the
subsequent year, it became the largest SI in Europe, overtaking Citadel Securities
and Tower Research.

XTX is also
one of the biggest liquidity providers globally. As of mid-2022, the company
accounted for 18% of all passive trading in European equities. This practice involves the buying and selling of shares that are not aimed at profit-making from short-term
price movements.

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