UK trading company XTX consolidates its market position with record profits

XTX Markets made a record profit last year, cementing the UK trading firm’s position at the heart of the financial markets and generating a multi-million dollar payout for owner Alexander Gerko.

London-based XTX made £667m in net profit in 2021, a record for the six-year company, compared with £470m in 2020 as it benefited from turbulent and affected markets by the pandemic, according to figures seen by the Financial Times that have been presented at the House of Companies.

The figures represent the earnings of the UK entities of XTX, which includes its markets division.

The company, founded by Russian-born mathematician Gerko, who has a 75 percent stake in the group, has pushed some of the biggest investment banks aside to establish itself as one of the leading traders and market makers. of the world.

The group trades nearly $300 billion a day in assets such as stocks, fixed income and futures. It is also one of the world’s top five forex traders, by market share, and trades almost a fifth of European equities.

Gains were derived from revenue of £1.48 billion ($1.79 billion) across its markets, trading and technology divisions, a 38% increase from 2020, when the company had revenue of £1.06 billion sterling.

Gerko’s company is a computerized trading group that relies on mathematical algorithms to make money from small differences in market prices.

The group, which employs 171 people in New York, Paris, Mumbai and Singapore but does not use human operators, was helped by changing expectations of the US central bank’s policy on interest rates and inflation.

This created profit opportunities in volatile markets for XTX and other algorithmic traders such as Ken Griffin’s Citadel Securities, which posted revenues of over $7 billion in 2021, and Jane Street, which managed to exceed $10 billion in profits in the 12 months until March. last year.

Gerko is a UK citizen who last year was listed as the 187th richest person by the Times, which estimated his wealth at £875m, more than double the previous year’s figure.

The Sunday Times also named Gerko as one of the UK’s top taxpayers, contributing £117.4m in tax in the year ending April 2021.

Additionally, Gerko has established XTX as a charitable donor that has donated over £60m since 2017 to various causes, making the company one of the top three corporate foundations in the UK.

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