Britain's amateur investment boom continues

Oscar Williams-Grut
·Senior City Correspondent, Yahoo Finance UK
·1 min read
Traders are seen at work at Northern Trust offices in London, Britain August 1, 2019. Picture taken August 1, 2019. REUTERS/Toby Melville
There has been a worldwide boom in amateur investing since the coronavirus struck. Photo: Toby Melville/Reuters

A flood of retail money into stock markets continues to boost the fortunes of trading platforms targeting DIY investors.

Trading platform CMC Markets (CMCX.L) and stockbroker Hargreaves Lansdown (HL.L) on Thursday both reported continued strong momentum in new business and activity on their platforms.

CMC said revenue from contracts for difference — a derivative product sold to investors — rose by 135% to £200m ($259m) over the last six months. Stockbroking revenue was up 85% to £26m. Peter Cruddas, chief executive of CMC, said it was a record half-year performance for the business.

Hargreaves Lansdown, meanwhile, said it had signed up 31,000 new clients over the last three months. Clients bought £800m of new money to the platform, helping assets under management rise by 3%.

Revenue rose by 12% to £143.7m, boosted by “strong stockbroking revenues from continued elevated share dealing volumes.”

READ MORE: Amateur investors chase profits during the pandemic

Both platforms have benefited from a worldwide boom in amateur investing since the coronavirus pandemic struck. A combination of share price volatility, falling discretionary spending, and people having more time on their hands due to lockdowns has attracted a new wave of retail money into markets.

Hargreaves Landsown said trading on its platform was “down on the peak levels seen earlier this year” but “remained high and averaged 980,000 deals per month.”

Despite the strong numbers, shares in both companies fell on Thursday. Hargeaves Lansdown dropped 4.8% and CMC Markets was down 1.5%.

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