In the FX sector, XTX Markets is one of the fastest growing trading shops – eating the market share of big investment banks – and it employs only a handful of staff, and no traders.
XTX Markets is now in the global top five of FX trading houses, has around 75 staff globally and relies on a team of programmers and mathematicians to get ahead of the competition.
Its new accounts on Companies House for 2016, show just how XTX’s headcount stacks up again other big investment banks. Its biggest office in London houses just 43 staff – 40 of which work in ‘support functions’. This is a huge increase on the previous year – 53% to be exact, from a low base of 28 people in 2015, but still pales in comparison to a big investment banks' FX team.
XTX has enjoyed a great 2016. It made £60.7m in profits for its UK operation from revenues of £131.8m, up from profits of £38m in 2015.
The firm has been both hiring in new people and paying them more. If investment banking pay inched up after a better 2016, XTX has more than doubled the amount it spent on employees to £10.5m last year. On an average pay per head basis, this means that XTX shelled out £244k ($317k) last year versus £146.4k in 2015.
Comparing this with investment banks is difficult, largely because banks’ big support functions are included within their compensation costs. But XTX’s average pay this year is not too far off Goldman Sachs, which paid an average of $338.5k in 2016.
XTX Markets has the benefit of being a nimble player with new and cutting edge technology, but it’s not a high frequency trader reliant on trade execution speed to get ahead. Instead, the firm is an example of a so-far successful use of running huge data sets through mathematical models and computer programmes, meaning its relying on an informational, rather than technological, advantage.
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