Flow Traders Q1 income surges on pandemic-led market volatility

AMSTERDAM, April 21 (Reuters) - Amsterdam-based Flow Traders said on Tuesday it thrived in the first quarter, aided by the coronavirus-induced market volatility, as its trading income surged and profit rose more than 10 times from last year.

Pretax profit for the high-frequency trading firm came in at 320.1 million euros ($346.7 million), compared with 23.2 million euros in the first quarter of 2019, and net trading income jumped to 495 million euros from 63.1 million euros.

High-frequency traders, which typically deploy sophisticated algorithms and powerful computers to move in and out of markets at lightning speeds, tend to do well when markets are volatile.

Flow Traders said it had activated backup trading plans during the pandemic, with a majority of employees working from home, and split teams working at back locations in Amsterdam, New York and Hong Kong.

“Given the market environment, we saw substantially increased volumes and heightened risk, as well as corresponding widening of spreads,” Chief Trading Officer Folkert Joling said in a statement.

“From a trading systems’ perspective, no outages or downtime were experienced during the intense period in mid-March,” Joling said, adding that the results also reflected the company’s new focus and investments in the U.S. markets and fixed income trading.

$1 = 0.9234 euros Reporting by Toby Sterling, Editing by Sherry Jacob-Phillips