GAIN Capital Holdings, Inc. (NYSE: GCAP) (“GAIN”, “The Company”) notes ESMA and FCA’s statements issued 14 December 2017 on their work in relation to the provision of contracts for differences (CFDs), including rolling spot forex, and binary options to retail clients.

GAIN remains strongly supportive of measures that enhance consumer protection in the FX/CFD market and elevate standards across the sector by, among other things, curbing aggressive marketing to inexperienced investors and mandating disclosure requirements that ensure all clients fully understand the risks of FX/CFD trading.

Over the past 12 months, GAIN has been actively engaged with both ESMA and FCA to discuss potential regulatory changes governing the industry.  GAIN has advocated for the adoption of leverage rules which strike an appropriate balance between providing additional protections to investors and other important considerations. In addition, GAIN believes that there are other effective protective measures available to ESMA and the FCA, including requiring enhanced screening of potential clients to ensure that only those persons for whom the products are appropriate are able to trade leveraged derivatives. GAIN has also strongly advocated for the adoption of more stringent corporate substance and regulatory capital requirements for obtaining a license as a CFD broker in the EU.

GAIN has also expressed concern, based in part on experience operating in other markets which went through regulatory change, that mandating excessively low leverage levels will have negative unintended consequences, including driving retail investors offshore to brokers that do not offer the level of investor protections present in strongly regulated markets.

As such, GAIN notes the availability of a consultation period in January 2018 and looks forward to having the opportunity to further engage with ESMA and FCA on these matters.

GAIN operates a broadly diversified business, which includes a retail FX/CFD business spanning eight regulatory jurisdictions, a U.S.-based retail futures business and an institutional trading business, GTX.  As a result of this diversification across business lines and geographies, less than 20% of GAIN’s total revenue came from retail customers in UK and EU in the three months ending September 30, 2017, and the Company does not expect the proposed changes to regulation, even if enacted unchanged, to have a material adverse effect on its overall financial results.

GAIN believes that new regulation tends to lead to industry consolidation, which will ultimately benefit large, well-capitalized firms like GAIN Capital.

About GAIN

GAIN Capital Holdings, Inc. provides innovative trading technology and execution services to retail and institutional investors worldwide, with multiple access points to OTC markets and global exchanges across a wide range of asset classes, including foreign exchange, commodities, and global equities. GAIN Capital is headquartered in Bedminster, New Jersey, with a global presence across North America, Europe and the Asia Pacific regions.  For further company information, visit

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