IG lifted as amateur traders take a chance

Volatility is unnerving professional stock market traders, but informed amateurs see it as a good opportunity to chance their arm.

That seems to be the story to draw from another good set of numbers for IG Group, the grandaddy of the spread betting industry. In the six months to the end of November, revenue jumped 28% to £195.5 million. The bulk came from the UK but the Australian and European arm is also growing.

IG enjoyed its best-ever month in August, driven by intense market activity that had punters swapping their positions and hedging their risk with verve. The company closed sports betting business Extrabet during the period.

IG won some business from the closure of MF Global, the scandal-hit trading business that lost billions on eurozone government debt. Its Canary Wharf arm had a small spread betting operation. IG could lose up to £300,000 from its exposure to MF.

"IG has benefited from the dramatic spike in volatility in early August, but unsurprisingly trading conditions throughout the remainder of the second quarter were less exceptional," Peel Hunt analyst Mark Williamson said. "At this juncture the key question has to be is this as good as it gets?"