BGC Group, Inc. (‘BGC’) operates as a leading global marketplace, data, and financial technology company that specializes in the trade execution of a broad range of products, including fixed income securities such as government bonds, corporate bonds, and other debt instruments, as well as related interest rate derivatives and credit derivatives.
The company provides brokerage services across foreign exchange, energy, commodities, shipping, equities, and futures and options. The company’s busin...
BGC Group, Inc. (‘BGC’) operates as a leading global marketplace, data, and financial technology company that specializes in the trade execution of a broad range of products, including fixed income securities such as government bonds, corporate bonds, and other debt instruments, as well as related interest rate derivatives and credit derivatives.
The company provides brokerage services across foreign exchange, energy, commodities, shipping, equities, and futures and options. The company’s business also provides network and connectivity solutions, market data, and related information services, and post-trade services.
The company’s integrated platform is designed to provide flexibility to customers with regard to price discovery, trade execution, and transaction processing, as well as accessing liquidity through its platforms for transactions executed either OTC or through an exchange. Through the company’s electronic brands, it offers several trade execution, market infrastructure, and connectivity services, as well as post-trade services.
The company’s clients include many of the world’s largest banks, broker-dealers, trading firms, hedge funds, governments, corporations, investment firms, commodity trading firms, and end users, such as producers and consumers. BGC is a global operation with offices across all major geographies, including New York and London, as well as in Bahrain, Beijing, Bogota, Brisbane, Cape Town, Chicago, Copenhagen, Dubai, Dublin, Frankfurt, Geneva, Hong Kong, Houston, Johannesburg, Madrid, Manila, Melbourne, Mexico City, Miami, Milan, Monaco, Nyon, Paris, Perth, Rio de Janeiro, Santiago, São Paulo, Seoul, Shanghai, Singapore, Sydney, Tel Aviv, Tokyo, Toronto, Wellington, and Zurich.
On March 18, 2024, the company joined the S&P SmallCap 600 Index. The S&P SmallCap 600 is designed to track the performance of the small-cap sector of the U.S. stock market.
Products and Services
Financial Brokerage
While voice and hybrid brokerage revenues still represent the majority of BGC’s overall revenues, the company continues to convert its voice and hybrid brokerage business to its higher margin, technology-driven Fenics business, which has grown to represent 25% of total BGC revenues during the fourth quarter and the year ended 2024. Over the past several years, it has invested in, and developed, new state-of-the-art trading platforms, including FMX UST, FMX FX, FMX Futures Exchange, PortfolioMatch, and Fenics GO, across rates, FX, equities, and credit, respectively. The company has also invested in, and deployed, trading technology solutions across its entire business, including its voice and hybrid brokerage desks, with an aim to increase broker productivity and to accelerate trends of electronic conversion. Underpinning the company’s efforts to automate and electronify its overall brokerage business are macro trends across the capital markets, where the adoption of electronic trading has accelerated in recent years.
The company categorizes its Fenics business as Fenics Markets and Fenics Growth Platforms as follows:
Fenics Markets includes the fully electronic portion of BGC’s brokerage business, data, network, and post-trade revenues that are unrelated to Fenics Growth Platforms, as well as Fenics Integrated revenues. Fenics Integrated seamlessly integrates hybrid liquidity with customer electronic orders either by GUI and/or API. Desks are categorized as ‘Fenics Integrated’ if they utilize sufficient levels of technology such that significant amounts of their transactions can be or are executed without broker intervention and have expected pre-tax margins of at least 25%.
Fenics Growth Platforms includes FMX UST, FMX FX, FMX Futures Exchange, Lucera, PortfolioMatch, Fenics GO, and the company’s other newer standalone platforms. Revenues generated from data, network, and post-trade attributable to Fenics Growth Platforms are included within their related businesses.
The company leverages its platforms to provide real-time product and price discovery information and straight-through processing to its customers for an increasing number of products. The company’s end-to-end solution includes real-time and auction-based transaction processing, credit and risk management tools, and back-end processing and billing systems. Customers can access the company’s trading application through its privately managed global high-speed data network, over the Internet, or through third-party communication networks.
FMX provides fully electronic trading in cash treasuries, foreign exchange, and U.S. interest rate futures by combining FMX’s U.S. Treasury business with the company’s state-of-the-art FMX Futures Exchange.
ECS Brokerage
The company provides brokerage services for the most widely traded energy and commodities products, including futures and OTC products covering refined and crude oil, power and electricity, natural gas, liquefied natural gas, environmental and emissions products, weather derivatives, base metals, coal, and soft commodities. It also provides brokerage services associated with the shipping of certain energy and commodities products.
Over the past few years, the company has expanded its ECS business through strategic acquisitions, hires, and organic growth.
In March 2019, the company acquired Ginga Petroleum, which provides a comprehensive range of brokerage services for physical and derivative energy products, including naphtha, liquefied petroleum gas, fuel oil, biofuels, middle distillates, petrochemicals, and gasoline.
In November 2019, the company expanded its shipping brokerage services through its acquisition of Poten & Partners, a leading shipping brokerage, consulting, and business intelligence firm specializing in liquefied natural gas, tanker, and liquefied petroleum gas markets. Founded over 80 years ago and with 160 employees worldwide, Poten & Partners provides its clients with valuable insight into the international oil, gas, and shipping markets.
In February 2023, the company acquired Trident, which specializes in environmental products and OTC and exchange-traded energy products. Trident bolsters the company’s leading environmental brokerage business and complements its existing energy brokerage offerings.
In 2023, the company announced the launch of its Weather Derivatives business, expanding BGC’s brokerage business into the weather and climate space. The Weather Derivatives business helps market participants analyze climate-related risks and mitigate their financial exposure. The company is providing liquidity to these increasingly important markets, as the role of weather and climate change impacts the way risk is managed. The launch of this business highlights BGC’s commitment to expand and explore new opportunities across the global energy and commodities space.
In October 2024, the company acquired Sage, an energy and environmental brokerage firm, and announced it entered into a definitive agreement to acquire OTC Global, the largest global independent institutional energy and commodities brokerage firm.
Brokerage Categories
The following table identifies some of the key products that the company brokers, inclusive of those discussed above:
Rates: Interest Rate Swaps, Interest Rate Options, Listed Rates Products, U.S. Treasuries, European Government Bonds, Other Global Government Bonds, Repurchase Agreements, Money Markets, Agency Fixed Income.
Credit: Corporate Bonds, High Yield Bonds, Emerging Market Bonds, Index CDS, Single Name CDS, Exotic Credit Derivatives, Asset-Backed Securities, Loans, Structured Products.
Foreign Exchange: Foreign Exchange Options, Spot FX, FX Forward, Non-Deliverable Forwards, Precious Metals.
ECS: Environmental/Emission Products, Weather Derivatives, Energy & Petrochemical Consulting, Shipping Brokerage, Power, Liquefied Natural Gas, Natural Gas, Base Metals, Dry Bulk (Coal & Iron Ore), Oil, Soft & Agricultural Products.
Equities: OTC Equity Derivatives, Listed Equity Futures & Options, Delta One Product, Convertibles, Cash Equities.
Certain trades in these key product types settle for clearing purposes with CF&Co (Cantor Fitzgerald & Co.), one of the company’s affiliates. CF&Co is a member of FINRA (Financial Industry Regulatory Authority) and the FICC (Fixed Income Clearing Corporation), a subsidiary of the DTCC (Depository Trust & Clearing Corporation). In addition, certain affiliated entities are subject to regulation by the CFTC (Commodity Futures Trading Commission), including CF&Co and BGCF (BGC Financial, L.P.). For certain products, the company, BGCF, and other affiliates act in a matched principal or principal capacity in markets by posting and/or acting upon quotes for its account. Such activity is intended, among other things, to assist the company and other affiliates in managing proprietary positions (including, but not limited to, those established as a result of combination of trades and errors), facilitating transactions, framing markets, adding liquidity, increasing commissions, and attracting order flow.
Technology Offerings
The company’s data, network, and post-trade offerings provide a range of trade lifecycle services, which include market data and analytics services, infrastructure and connectivity solutions, and post-trade services, such as risk mitigation, matching, and other data, network, and post-trade optimization services. These businesses have highly recurring and compounding revenue bases, which are reported within its Fenics business.
Fenics Market Data is a supplier of real-time, tradable, indicative, end-of-day, and historical market data. The company’s market data product suite includes fixed income, interest rate derivatives, credit derivatives, foreign exchange and money markets, energy and commodities, equity derivatives, and regulatory solution market data products and services. The data is sourced from the voice, hybrid, and fully electronic brokerage operations and made available to financial professionals, research analysts, compliance and surveillance departments, and other market participants via direct data feeds and BGC-hosted FTP environments, as well as via information platforms such as Bloomberg, LSEG Data & Analytics, ICE Data Services, and other select specialist vendors.
Through the company’s network business, it provides customized screen-based market solutions to both related and unrelated parties. The company’s clients are able to develop a marketplace, trade with their customers, and access its network and its intellectual property. The company can add advanced functionality to enable its customers to distribute branded products to their customers through online offerings and auctions, including private and reverse auctions, via its trading platform and global network.
As part of the company’s network business, its Lucera brand delivers high-performance technology solutions designed to be secure and scalable and to power demanding financial applications across several offerings: LumeFX (distributed FX platform with managed infrastructure and software stack), LumeMarkets (multi-asset class aggregation platform), Connect (global SDN for rapid provisioning of connectivity to counterparties), and Compute (on-demand, co-located compute services in key financial data centers).
Through kACE2, the company’s analytics brand, it offers derivative price discovery, pricing analysis, risk management, and trading software used by approximately 227 client sites in over 23 countries. The company’s clients include mid-tier banks, financial institutions, and corporate clients. The company’s Gateway module links its client base with their counterparties, trading venues, and regulators, and provides automated order flow, straight-through processing, data distribution, and regulatory reporting.
The company’s post-trade services include post-trade risk mitigation services that are designed to bring greater capital and operational efficiency to the global derivatives market. The company’s post-trade services assist clients in managing the growing cost of holding derivatives while helping them to meet their regulatory mandates and promote sustainable growth and lower systemic risk, and to improve resiliency in the industry.
Customers and Clients
The company primarily serves the wholesale financial and energy, commodity, and shipping markets, with clients including many of the world’s largest banks, brokerage houses, investment firms, hedge funds, investment banks, commodity trading firms, and end users, such as producers and consumers. Customers using its products and services also include professional trading firms, futures commission merchants, and other professional market participants and financial institutions. The company’s market data products and services are available through many platforms and are available to a wide variety of capital market participants, including banks, brokerage firms, asset managers, hedge funds, investment analysts, compliance and surveillance professionals, and financial advisors. For the year ended December 31, 2024, the company’s top ten customers, collectively, accounted for approximately 27.1% of its total revenue on a consolidated basis, and its largest customer accounted for approximately 4.8% of its total revenue on a consolidated basis.
Sales and Marketing
The company’s brokers and salespeople are its primary marketing and sales resources and utilize a combination of sales, marketing, and co-marketing/co-branding campaigns. The company’s sales and marketing programs are aimed at enhancing the ability of its brokers to cross-sell effectively, in addition to informing its customers about its product and service offerings. The company leverages its customer relationships through a variety of direct marketing and sales initiatives and builds and enhances its brand image through marketing and communications campaigns targeted at a diverse audience, including traders, potential partners, and the investor and media communities.
The company’s brokerage product team is composed of product managers who are each responsible for a specific part of its brokerage business. The product managers seek to ensure that its brokers, across all regions, have access to technical expertise, support, and multiple execution methods to grow and market their business.
The company’s team of business development professionals is responsible for growing its global footprint through raising awareness of its products and services. The business development team markets its products and services to new and existing customers. As part of this process, it analyzes existing levels of business with these entities in order to identify potential areas of growth and also to cross-sell its multiple offerings.
Trading Technology
Pre-Trade Technology: The company’s financial brokers use a suite of pricing and analytical tools that have been developed both in-house and in cooperation with specialist software suppliers. The pre-trade software suite combines proprietary market data, pricing, and calculation libraries, together with those outsourced from external providers. The tools, in turn, publish to a normalized, global market data distribution platform, allowing prices and rates to be distributed to its proprietary network, data vendor pages, secure websites, and trading applications as indicative pricing.
Inter-Dealer and Wholesale Trading Technology: The company utilizes sophisticated proprietary electronic trading platforms to provide execution and market data services to its customers. The services are available through its proprietary API, FIX, and a multi-asset proprietary trading platform, operating under brands, including BGC Trader, CreditMatch, Fenics, FMX, GFI ForexMatch, BGCForex, BGCCredit, BGCRates, FMX FX, FMX UST, FMX NDF, FMX Repo, FenicsDirect, Fenics GO, MidFX, and GBX. These platforms support a wide and constantly expanding range of products and services, which include U.S. Treasuries and other government bonds, repos, OTC interest rate derivatives in multiple currencies, spot FX, NDFs, FX options, corporate bonds, credit derivatives, and other products. Every product on the platforms is supported in either view-only, hybrid/managed, or fully electronic mode, and can be transitioned from one mode to the next in response to market demands. The flexible BGC technology stack is designed to support feature-rich workflows required by the hybrid mode, as well as delivering high throughput and low transaction latency required by the fully electronic mode. Trades executed by its customers in any mode are, when applicable, eligible for immediate electronic confirmation through direct STP links as well as STP hubs. The BGC trading platform services are operated out of several globally distributed data centers and delivered to customers over BGC’s global private network, third-party connectivity providers, as well as the Internet. BGC’s proprietary graphical user interfaces and the API/FIX connectivity are deployed at hundreds of major banks and institutions and service thousands of users.
Post-Trade Straight Through Processing Technology: The company’s platform automates transaction processing, confirmation, and other functions, substantially improving and reducing the cost of many of its customers’ back offices and enabling STP. In addition to the company’s own system, confirmation and trade processing are also available through third-party hubs, including MarkitWIRE, ICElink, Reuters RTNS, and STP in FIX for various banks.
The company has electronic connections to most mainstream clearinghouses, including DTCC, CLS Group, Euroclear, Clearstream, Monte Titoli, LCH, Eurex Clearing, CME Clearing, and the OCC (Options Clearing Corporation). As more products become centrally cleared, and as its customers request that the company use a particular venue, it expects to expand the number of clearinghouses to which it connects in the future.
Systems Architecture: The company’s systems consist of layered components, which provide matching, credit management, market data distribution, position reporting, customer display, and customer integration. The private network currently operates from six concurrent core data centers (three of which are in the U.K., and one each in Trumbull, Connecticut, Weehawken, New Jersey, and Secaucus, New Jersey) and many hub cities throughout the world acting as distribution points for all private network customers. The redundant structure of its system provides multiple backup paths and re-routing of data transmission in the event of failure.
In addition to the company’s own network system, it also receives and distributes secure trading information from customers using the services of multiple, major Internet service providers throughout the world. These connections enable the company to offer its products and services via the Internet to its global customers.
Software Development
The company devotes substantial efforts to the development and improvement of its hybrid and fully electronic marketplaces and licensed software products and services. It works with its customers to identify their specific requirements and make modifications to its software, network distribution systems, and technologies that are responsive to those needs. The company’s efforts focus on internal development, strategic partnering, acquisitions, and licensing.
Competition
Inter-Dealer and Wholesale Financial Brokers
The company primarily competes with two publicly traded, diversified inter-dealer and wholesale financial brokers, TP ICAP and Tradition. Other competitors include Dealerweb, an inter-dealer and wholesale financial brokerage business within Tradeweb, Marex Group, which focuses on energy and commodities brokerage, and a number of private firms that tend to specialize in specific product areas or geographies.
Market Data and Information
The majority of the company’s large inter-dealer and wholesale financial broker competitors also sell proprietary market data and information, which competes with its market data offerings. Some of these market data and information providers, such as Bloomberg L.P. and LSEG Data & Analytics.
The company competes with other market infrastructure and connectivity providers, such as Pico, ION Group, and Bloomberg.
Exchanges and Other Trading Platforms
The company also competes with CME (CME Group Inc.) across U.S. interest rates products, including its FMX UST platform and FMX Futures Exchange, as well as in foreign exchange products.
In addition to exchanges, other electronic trading platforms, which primarily operate in the dealer-to-client markets, including those run by MarketAxess and Tradeweb, now compete with the company in the inter-dealer markets.
Seasonality
The company’s revenues tend to be strongest in the first quarter and lowest in the second half of the year. For the year 2024, it earned approximately 25.6% of its revenues in the first quarter, while in 2023, it earned 26.4% of its revenues in the first quarter (year ended December 31, 2024).
Regulation
The company and its subsidiaries are also subject to the various anti-fraud provisions of the Securities Act, the Exchange Act, the Commodity Exchange Act, certain state securities laws, and the rules and regulations thereunder.
The SEC is the federal agency primarily responsible for the administration of federal securities laws, including adopting rules and regulations applicable to broker-dealers (other than government securities broker-dealers) and enforcing both its rules regarding broker-dealers and the Treasury’s rules regarding government securities broker-dealers. In addition, the company operates a number of platforms that are governed pursuant to SEC Regulation ATS. Broker-dealers are also subject to regulation by state securities administrators in those states in which they conduct business or have registered to do business. In addition, Treasury rules relating to trading government securities apply to such activities when engaged in by broker-dealers. The CFTC is the federal agency primarily responsible for the administration of federal commodities future laws and other acts, including the adoption of rules applicable to FCMs, DCMs, and SEFs, such as BGC Derivative Markets and GFI Swaps Exchange LLC.
Much of the regulation of broker-dealers’ operations in the United States has been delegated to self-regulatory organizations. These self-regulatory organizations adopt rules (which are subject to approval by the SEC) that govern the operations of broker-dealers and government securities broker-dealers and conduct periodic inspections and examinations of their operations. In the case of the company’s U.S. broker-dealer subsidiaries, the principal self-regulatory organization is FINRA. FINRA was formed from the consolidation of the National Association of Securities Dealers’ member regulation operations and the regulatory arm of the NYSE Group to act as the self-regulatory organization for all broker-dealers doing business within the United States. Accordingly, the company’s U.S. broker-dealer subsidiaries are subject to both scheduled and unscheduled examinations by the SEC and FINRA. In the company’s futures-related activities, its subsidiaries are also subject to the rules of the CFTC, futures exchanges of which they are members, and the NFA, a futures self-regulatory organization.
The company has subsidiaries regulated by the FCA (some include BGC Brokers L.P., GFI Securities Limited, and GFI Brokers Limited).
Every U.S.-registered broker-dealer is subject to the Uniform Net Capital Requirements. FCMs, such as its subsidiary, Mint Brokers, are also subject to CFTC capital requirements.
Four of the company’s subsidiaries, BGCF, GFI Securities LLC, FMX Execution, LLC, and Mint Brokers, are registered with the SEC and are subject to the Uniform Net Capital Requirements. As an FCM, Mint Brokers is also subject to CFTC minimum capital requirements. BGCF, GFI Securities LLC, FMX Execution, LLC, Amerex Brokers LLC, Sage Refined Products, Liquidity Partners, IVG Energy Ltd., and Trident Brokerage Services LLC are registered as Introducing Brokers with the NFA. BGCF is also a member of the FICC, which imposes capital requirements on its members.
The company’s international operations are also subject to capital requirements in their local jurisdiction. BGC Brokers L.P., GFI Brokers Limited, and GFI Securities Limited, which are based in the U.K., are currently subject to solo capital requirements established by the FCA’s Investment Firm Prudential Regime. In addition, BGC European Holdings LP is subject to the FCA’s consolidated capital requirements. The capital requirements of its French entities (and their EU branches) are predominantly set by ACPR and AMF. The U.K. and the EU authorities apply stringent provisions with respect to capital applicable to the operation of these brokerage firms, which vary depending upon the nature and extent of their activities.
In addition, the majority of the company’s other foreign subsidiaries are subject to similar regulation by the relevant authorities in the countries in which they do business. Additionally, certain other of the company’s foreign subsidiaries are required to maintain non-U.S. net capital requirements. For example, in Hong Kong, BGC Securities (Hong Kong), LLC, GFI (HK) Securities LLC, and Sunrise Brokers (Hong Kong) Limited are regulated by the Securities and Futures Commission. BGC Capital Markets (Hong Kong) Limited and GFI (HK) Brokers Ltd are regulated by The Hong Kong Monetary Authority. All are subject to Hong Kong net capital requirements. In France, Aurel BGC SAS and BGC France Holdings; in Australia, Fixed Income Solutions Pty Ltd and BGC Partners (Australia) Pty Limited; in Japan, BGC Shoken Kaisha Limited’s Tokyo branch and BGC Capital Markets Japan LLC’s Tokyo Branch; in Singapore, BGC Partners (Singapore) Limited, GFI Group Pte Ltd, and Ginga Global Market Pte Ltd; in South Korea, BGC Capital Markets & Foreign Exchange Broker (Korea) Limited and GFI Korea Money Brokerage Limited; in the Philippines, GFI Group (Philippines) Inc., all have net capital requirements imposed upon them by local regulators. In addition, the LCH (London International Financial Futures and Options Exchange/London Metal Exchange) clearing organization, of which BGC Brokers L.P. is a member, also imposes minimum capital requirements. In Latin America, BGC Liquidez Distribuidora De Titulos E Valores Mobiliarios Ltda. (Brazil) has net capital requirements imposed upon it by local regulators.
Brands and Trademarks
Amerex, Aurel, Aurel BGC, Caventor, CBID, Conticap, CreditMatch, BGC, BGC Group, BGC Partners, BGC Trader, ELX, Euro Brokers, Fenics, Fenics.com, Fenics Markets Xchange, Fenics Digital, FMX UST, FMX FX, Fenics Direct, Fenics MID, Fenics MD, Fenics Market Data, Fenics GO, Fenics PortfolioMatch, FMX, FMX Futures, FMX Markets Xchange, FMX UST, FMX FX, FMX Repo, FMX NDF, GFI, GFI Ginga, kACE2, Lake Securities, Latium Capital, LumeFX, LumeMarkets, Lucera, Martin Brokers, Maxcor, Matchbox, Mint, MIS Brokers, Open Energy, Perimeter Markets Inc., Poten & Partners, RP Martin, Tower Bridge, Sage, Sunrise Brokers, and VolumeMatch are among the trademarks/service marks and/or registered trademarks/service marks of BGC Group and/or its affiliates in the U.S. and/or other jurisdictions.
History
BGC Group, Inc. was founded in 1945. The company was incorporated in 2021
