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Finance

UK's IG Group plummets after muted markets force revenue outlook cut 

Published by Global Banking & Finance Review

Posted on October 2, 2026

2 min read

· Last updated: October 2, 2026

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IG Group Shares Plunge Over 27% After Revenue Outlook Cut Amid Muted Markets

IG Group Faces Sharp Share Drop Following Revenue Forecast Reduction

Market Volatility and Revenue Impact

Oct 2 (Reuters) - Shares of Britain's IG Group plunged more than 27% on Friday after the online trading firm cut its annual revenue forecast due to subdued trading volatility.  

IG Group, like its peers, earns more when volatile markets prompt clients to trade heavily. However, it revamped its hedging strategy in 2025, keeping more trading income from clients in-house by cutting hedging costs, but leaving it more exposed when market conditions calm and clients trade less aggressively.

OTC Revenue Retention Decline

The company said OTC revenue retention — its share of OTC trading flow it keeps as revenue — slipped to about 70%, against an average of about 80% since the market-making optimisation measures were introduced in the second half of 2025. 

Share Price Movements

Shares of the FTSE-100 firm were on track to record their biggest fall since December 2016, down 22.4% to 993 pence as of 0958 GMT.

Peer Performance and Analyst Insights

Performance of Plus500 and CMC Markets

Peer Plus500 was down 5.3% despite saying it was trading in line with the market view for fiscal 2026 and that it maintained a strong cash position. CMC Markets was down 9.1%.

Analyst Commentary on Underdog Acquisition

Revenue Shortfall for Underdog

Analysts at RBC Capital Markets also flagged that Underdog's roughly $105 million third-quarter revenue fell short of the $125 million quarterly run rate it averaged in the first half of 2026. IG bought the US prediction markets operator in July this year.

Updated Financial Outlook

Revised Revenue Growth Expectations

IG now expects 2026 group revenue growth to be in the mid-single-digit percentage range, compared with the previous forecast of 10-15% growth.

Third-Quarter Revenue Forecast

Third-quarter revenue is expected to be about £240 million ($316.97 million), down roughly 14%.

Exchange Rate Information

($1 = 0.7572 pounds)

Reporting Credits

(Reporting by Neeshita Beura and Yamini Kalia in Bengaluru; Editing by Sherry Jacob-Phillips and Janane Venkatraman)

Key Takeaways

  • IG Group slashes annual revenue growth outlook to mid‑single‑digit range, down from prior 10–15% guidance.
  • OTC revenue retention dropped to about 70% (from ~80% since H2 2025), reducing profitability.
  • Peers Plus500 and CMC Markets also fell, though less sharply; IG’s wider strategy shifts—including market‑making optimisation and acquisition of Underdog—may amplify revenue volatility.

Frequently Asked Questions

Why did IG Group shares plummet over 27%?
IG Group shares fell over 27% after the company cut its annual revenue forecast due to subdued trading volatility.
What changes did IG Group make to its hedging strategy?
IG Group revamped its hedging strategy in 2025, keeping more trading income in-house and reducing hedging costs, leaving it more exposed to low volatility.
How did market conditions affect IG Group's revenue?
Subdued trading volatility resulted in less client trading activity, lowering IG Group's revenue and prompting a revised, lower growth forecast.
What was the impact on IG Group's peers?
Plus500 shares dropped 5.3%, CMC Markets shares fell 9.1%, and IG Group's OTC revenue retention dropped to about 70%.

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