Around 350,000 trades a day and a target of $40bn in volumes? The numbers are beginning to stack up for ADS Securities. Managing director Philippe Ghanem explains why the start-up brokerage has the edge on the world’s biggest players.
“I come in every day,” says Philippe Ghanem. “My weekend is Saturday afternoon. Success is the cherry on the cake, but you have to protect your business. Work, work, work.”
No-one could accuse Ghanem of shirking his responsibilities. He is managing director and vice chairman of ADS Securities, the Abu Dhabi-based forex and commodities trading firm, which is approaching its first anniversary. By any measure, the firm has had a successful twelve months of operation. Ghanem, and the company chairman, Mahmood Ebraheem Al Mahmood (an alumnus of the Abu Dhabi Investment Authority, no less) have hired a crack team that is seeing volumes that are frequently in excess of $4bn a day.
“You have to understand that it’s not easy to bring people to Abu Dhabi,” Ghanem smiles. “I was convincing people in an office the size of this couch. People thought we were being completely unrealistic. Who are these people saying, ‘we are going to build ADS Securities into an economic force’ from the corner of an office?”
No-one is calling him or ADS Securities crazy now. The immediate impression one gets from a meeting with Ghanem, an expressive, personable Swiss Lebanese who sits behind the requisite bank of trading screens, is that his work has barely begun. In fact, this small brokerage house has grand plans to compete on a global scale with giants such as Glencore, the commodities trading giant that listed last year for a total of $61bn.
So why is he so confident?
“The online and offline business, and brokerage, have been very, very challenged,” Ghanem says. “Why? Because this is a very lucrative business, and if you put yourself on the right track, you can make a lot of money. If you see the main big banks, their balance sheets boomed because of this business.
“So taking that into consideration, we decided that this company could only work in Abu Dhabi. Why? Because here you have a certain image of stability. Abu Dhabi is solid; it’s not a country that has burnt its cash.”
Warming to his task, Ghanem is quick to laud the UAE as “the Switzerland in terms of security”, adding that his local clients tend to prefer to keep their money within the region rather than farming it off elsewhere.
Other than the safe haven aspect, ADS Securities is also leveraging Abu Dhabi’s geographical position as a stop-gap between the trading hubs of the Far East and Europe.
“It means that today, a guy can open a position any time of day; he doesn’t need to wake up early and follow the equity market, and be limited to when he can short sell — here it’s open-ended,” Ghanem says. “So immediately we saw a very big impact. There is a constant demand, so it’s clearly another thing the world needs.
“It’s very volatile, and there’s a gap, so Asians sleep later and Europeans wake up earlier. This gap is very expensive, and this is where the banks and institutions lose money, or make money, but most probably they are vulnerable in this area.
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