Flow Traders N.V. — Interim / Quarterly Report 2018

Jul 27, 2018

F L 0w TRADERS

Half Year Report 2018

Table of contents Table of contents

Flow Traders at a Glance Flow Traders at a Glance

Flow Traders at a Glance FLOW Traders at a Glance

Our Business Our Business

We provide liquidity in financial products, with a focus on exchange-traded products (ETPs). ETPs are baskets of securities made up of shares, bonds, or commodities. ETPs often track indices and, unlike most mutual funds, can be traded throughout the day on trading venues. We do this globally, enabling investors to buy and sell ETPs efficiently by quoting bid and ask prices under virtually all market circumstances. We provide liquidity in financial products, with a focus on exchange—traded products (ETPs). ETPs are baskets of securities made up of shares, bonds, or commodities. ETPs often track indices and, unlike most mutual funds, can be traded throughout the day on trading venues. We do this globally, enabling investors to buy and sell ETPs efficiently by quoting bid and ask prices under virtually all market circumstances.

Markets & Trends Markets & Trends

Our business Our business

We trade in well over 12,000 financial instruments, and have access to almost 150 trading venues in over 40 countries around the world. We provide liquidity in over 6,000 ETP listings on- and off-exchange. We trade in well over 12,000 financial instruments, and have access to almost 150 trading venues in over 40 countries around the world. We provide liquidity in over 6,000 ETP listings on— and off—exchange.

Off-exchange, we provide liquidity in ETPs on a requestfor-quote basis to over 775 institutional counterparties across the globe, including banks, asset managers, pension funds, insurance companies, family offices, hedge funds, and others. Besides ETPs, we provide liquidity in similar instruments, whose value is correspondingly affected by a change in the value of their underlying assets. Off—exchange, we provide liquidity in ETPs on a request for—quote basis to over 775 institutional counterparties across the globe, including banks, asset managers, pension funds, insurance companies, family offices, hedge funds, and others. Besides ETPs, we provide liquidity in similar instruments, whose value is correspondingly affected by ^a change in the value oftheir underlying assets.

As a liquidity provider, we do not have an opinion on the market. We trade market neutral. That means that our results do not depend on the direction of market prices. Our Net Trading Income is realized through the small price differences between the ETPs and other financial instruments we buy or sell, and the prices we pay or receive for the underlying or related financial instruments to mitigate our risk. As ^a liquidity provider, we do not have an opinion on the market. We trade market neutral. That means that our results do not depend on the direction of market prices. Our Net Trading Income is realized through the small price differences between the ETPs and other financial instruments we buy or sell, and the prices we pay or receive for the underlying or related financial instruments to mitigate our risk.

The ETP market The ETP market

The popularity of ETPs has continued to increase in the recent years. According to asset manager BlackRock Advisors, global ETP Assets under Management (AuM) grew from €3,962 billion in 2017 to €4,237 billion by the end of June 2018. This growth is expected to continue, with sources such as PwC, EY and others predicting the market will The popularity of ETPs has continued to increase in the recent years. According to asset manager BlackRock Advisors, global ETP Assets under Management (AuM) grew from €3,962 billion in 2017 to €4,237 billion by the end of June 2018. This growth is expected to continue, with sources such as PwC, EY and others predicting the market will

continue to grow substantially, some estimate to over US\$25 trillion in AuM by 2025. Investors are expected to continue to invest in low-cost, transparent and easy-to-trade passive investment strategies. continue to grow substantially, some estimate to over US\$25 trillion in AuM by 2025. Investors are expected to continue to invest in low—cost, transparent and easy—to—trade passive investment strategies.

We believe there are a number of reasons for this trend to continue, also after 2025: one is that investors are attracted to the transparent nature of ETPs, which enables them to follow clearly how the underlying securities are performing. Another is that ETPs are liquid and available at low costs, and can be bought and sold easily during market hours. So it simplifies trading. A third reason is that ETPs can be composed of financial instruments from almost any asset class, sector or location, giving investors access to markets that would normally be difficult to reach. We believe there are ^a number of reasons for this trend to continue, also after 2025: one is that investors are attracted to the transparent nature of ETPs, which enables them to follow clearly how the underlying securities are performing. Another is that ETPs are liquid and available at low costs, and can be bought and sold easily during market hours. So it simplifies trading. Athird reason is that ETPs can be composed offinancial instruments from almost any asset class, sector or location, giving investors access to markets that would normally be difficult to reach.

Review of 2018 Reuiew of2018

So far 2018 has been a year with different faces. The first quarter of 2018 was very much determined by several developments, such as the implementation of MiFID II in Europe and the geopolitical developments, which led to a pickup in market activity. This resulted in very volatile markets in the first two weeks of February, which helped shaping the best quarterly result for Flow Traders since inception. The second quarter of 2018 was characterized by a slowdown in market trading activities. The political tensions in Italy did add to the trading results in the first half of 2018, as market activity briefly picked up, but overall, the second quarter was not as active as the first quarter. So far 2018 has been ^a year with different faces. The first quarter of 2018 was very much determined by several developments, such as the implementation of MiFID II in Europe and the geopolitical developments, which led to a pickup in market activity. This resulted in very volatile markets in the first two weeks of February, which helped shaping the best quarterly result for Flow Traders since inception. The second quarter of 2018 was characterized by a slowdown in market trading activities. The political tensions in Italy did add to the trading results in the first half of 2018, as market activity briefly picked up, but overall, the second quarter was not as active as the first quarter.

Our Risk Management Our Risk Management

Flow Traders' Risk Management Framework (RMF) forms the foundation of our approach to managing key risks. Flow Traders' Risk Management Framework (RMF) forms the foundation of our approach to managing key risks.

Where possible, we identify, assess, monitor, quantify and document possible risks which are inherent to trading in an automated environment. In this very dynamic world of automated trading, we have designed our RMF in such a way that it is robust, efficient and transparent. The RMF helps ensure that we have sufficient internal control and internal capital through a consistent, continuous and careful method for addressing, managing and prioritising key risks in the context of our enterprise-wide strategic objectives. Where possible, we identify, assess, monitor, quantify and document possible risks which are inherent to trading in an automated environment. In this very dynamic world ofautomated trading, we have designed our RMF in such ^a way that it is robust, efficient and transparent. The RMF helps ensure that we have sufficient internal control and internal capital through a consistent, continuous and careful method for addressing, managing and prioritising key risks in the context of our enterprise—wide strategic objectives.

Enterprise Risk Management Enterprise Risk Management

We aim for a good balance between our business activities, risk and return. Our risk management is based on the COSO Enterprise Risk Management (ERM) framework, which ensures that the risk appetite and profile are integrated into the day-to-day operations and the strategic, tactical and operational objective setting and decision making. We aim for ^a good balance between our business activities, risk and return. Our risk management is based on the C050 Enterprise Risk Management (ERM) framework, which ensures that the risk appetite and profile are integrated into the day—to—day operations and the strategic, tactical and operational objective setting and decision making.

Effective ERM practices, such as the COSO framework, requires that the key components (control environment, risk assessment, control activities, information and communication and monitoring activities) operate in an integrated manner with the strategic, operational, reporting and compliance objectives across all company levels. Effective ERM practices, such as the C050 framework, requires that the key components (control environment, risk assessment, control activities, information and communication and monitoring activities) operate in an integrated manner with the strategic, operational, reporting and compliance objectives across all company levels.

We incorporate these principles by implementing the following ERM Cycle. We incorporate these principles by implementing the following ERM Cycle.

Every year our Management Board sets its business targets following the strategic goals (1). Based on the target and objectives, the Management Board formulates its risk appetite (2). The targets, objectives and risk appetite give direction to the various departments within the company and are used to derive our strategic risks. Every year our Management Board sets its business targets following the strategic goals (1). Based on the target and objectives, the Management Board formulates its risk appetite (2). The targets, objectives and risk appetite give direction to the various departments within the company and are used to derive our strategic risks.

We implement our Risk Management cycle (3) to ensure that the residual risk profile is (and remains) in line with the set risk appetite. To achieve this, we perform risk (self) assessments (RSA) to identify and assess current and newly arisen risks and compliance with applicable requirements. Following the RSAs, local department heads and global heads in cooperation with the Management Board, then decide on the appropriate risk response. The effects of the chosen risk responses are monitored and periodically the actual residual risk profile is mapped versus the appetite. We implement our Risk Management cycle (3) to ensure that the residual risk profile is (and remains) in line with the set risk appetite. To achieve this, we perform risk (self) assessments (RSA) to identify and assess current and newly arisen risks and compliance with applicable requirements. Following the RSAs, local department heads and global heads in cooperation with the Management Board, then decide on the appropriate risk response. The effects ofthe chosen risk responses are monitored and periodically the actual residual risk profile is mapped versus the appetite.

Risk categories Risk categories

Flow Traders identifies three general risk categories (Strategic risks, Operational risks and Financial risks), each with their own specific risks areas: Flow Traders identifies three general risk categories (Strategic risks, Operational risks and Financial risks), each with their own specific risks areas:

category Risk category Risk	Context Context
STRATEGIC RISKS STRATEGIC RISKS
Strategic Business and Strategic Business and	This concerns risk related to Flow Traders' strategy, business model and market conditions. Volatility risk to model market Volatility concerns related Traders' strategy, conditions. This risk Flow business and risk
risk risk	ofthis ofthe part profitability a function of is part of this risk as our Net Trading Income and profitability are primarily a function of the level of our Net Income primarily level risk Trading and are as is
	trading activity, or trading volumes, in the financial instruments in which we trade. trading activity, trading volumes, the financial instruments trade. or which we in in
Compliance Compliance and and	ofviolation Compliance risk is the threat posed to a company's earnings or capital as a result of violation or Compliance is the threat to a company's capital a result risk posed earnings or or as
regulatory risk regulatory risk	of non-conformance with laws, regulations, or prescribed practices. It also concerns the risk of changing with regulations, the non—conformance laws, or prescribed practices. It also concerns risk changing
	(regulatory regulatory rules (regulatory risk). regulatory rules risk).
	ofthe that In addition it includes the risk that the integrity of the organisation or its operations is jeopardised as a addition itincludes the the integrity organisation operations isjeopardised risk or its as In a
	of ofthe staff result of unethical behaviour of the organisation, its staff members or management. result unethical behaviour organisation, members management. its or
Concentration risk Concentration risk	of from of Probability of loss arising from heavily lopsided exposure to a particular group of counterparties or Probability exposure to a particular group counterparties arising heavily lopsided or loss
	products. Concentration supplier dependency products. Concentration risk also includes supplier dependency risks. risk also includes risks.
Legal risk Legal risk	of is the resulting from failure to to legally The legal risk is the risk of loss resulting from a claim, failure to adhere to legally binding agreements legal a claim, adhere binding agreements The risk risk loss
	ofthe and requirements, or failure to adequately protect assets of the firm or a change in law and regulations requirements, failure to adequately protect firm regulations and or assets or change law and in a
	laws and regulations. regulations. laws and
Reputation risk Reputation risk	of reputation is the resulting from to The reputation risk is the risk of loss resulting from negative exposure to stakeholders. risk negative exposure stakeholders. The risk loss
OPERATIONAL OPERATIONAL RISKS RISKS
risk IT risk T	of from information technology The IT risk concerns the risk of loss resulting from inadequate information technology and processing in concerns the resulting inadequate processing The risk risk loss and IT in
	of controllability terms of availability, manageability, integrity, controllability and continuity, insufficient protection, or terms availability, integrity, continuity, insufficient protection, manageability, or and
	inadequate IT strategy and policy or inadequate use. strategy inadequate policy inadequate and or use. IT
Securityrisk IT Security risk IT	relating to integrity This concerns risks relating to access management and data integrity risks. concerns management data This risks access and risks.
Operational risk Operational risk	of operational from failed internal The operational risk is the risk of loss resulting from inadequate or failed internal processes and people is the resulting inadequate or people The risk risk loss processes and
	from external of or from external events. The main driver of operational risk is human error. or events. driver operational is human The main risk error.
FINANCIAL FINANCIAL RISKS RISKS
Liquidityrisk Liquidity risk	is the that is not sufficient trading capital Liquidity risk is the risk that there is not sufficient trading capital available. This risk can be managed by Liquidity there available. managed risk risk This risk can be by
	monitoring of from cash, portfolio efficiency intra-day monitoring of credit lines from the prime brokers, cash, portfolio efficiency and liquidity. credit lines the prime brokers, liquidity. intra—day and
	from Furthermore, liquidity risk can arise from having illiquid products on the book which cannot be turned in Furthermore, liquidity illiquid products the book cannot turned risk can arise having on which be in
	of timeframe a short timeframe into liquid assets like cash. This part of liquidity risk can be mitigated by procedures short into liquid part liquidity mitigated procedures assets like risk cash. This can be by a
	ofthe that allow trading liquid products monitoring the liquidity that only allow trading liquid products and by monitoring the liquidity of the book. only and book. by
Market risk Market risk	Market is the to institution resulting from movements market Market risk is the risk to an institution resulting from movements in market prices; in particular, changes risk particular, changes risk an prices; in in
	commodity in interest rates, foreign exchange rates, and equity and commodity prices. Market risk could be suffered interest foreign equity Market could suffered rates, exchange rates, and and prices. risk be in
	ofa portfolio in the event of a firm trading on its own account and the portfolio suffering a devaluation due to the event firm trading account the suffering a devaluation to its own and due on in
	market developments. mitigated the market changing market circumstances or developments. This risk can be mitigated by hedging the market changing circumstances or risk hedging This can be by
	portfolio the market movements. exposures and making the portfolio less reactive on market movements. exposures and making reactive on less
risk Credit Credit risk	ofa counterparty and/or institution trading a financial Credit risk is the risk of a counterparty and/or issuing institution involved in trading in or issuing a financial Credit is the involved or risk risk issuing issuing in in
	instrument defaulting on an obligation, and thus harming the company's financial position. instrument defaulting obligation, thus harming the company's financial and position. on an

Risk Management Governance Risk Management Governance

The effectiveness of risk management is unavoidably linked to commitment and integrity. It is therefore crucial that the Management Board, global and local department heads, and all Flow Traders employees are aware of the company's risk exposure and their own responsibilities, as well as the responsibilities of Flow Traders as a whole. The effectiveness of risk management is unavoidably linked to commitment and integrity. It is therefore crucial that the Management Board, globaland localdepartment heads, and all Flow Traders employees are aware ofthe company's risk exposure and their own responsibilities, as well as the responsibilities of Flow Traders as ^a whole.

Our risk management is embedded in the organisation in line with the three lines of defence model. Our risk management is embedded in the organisation in line with the three lines of defence model.

The first line of defence is formed by trading. The first line of defence is formed by trading.

The second line of defence is responsible for policy setting, oversight and monitoring regarding risks, rules and requirements. The Risk Management, Compliance and Finance departments are responsible for the continuous risk management of the company. The second line of defence is responsible for policy setting, oversight and monitoring regarding risks, rules and requirements. The Risk Management, Compliance and Finance departments are responsible for the continuous risk management ofthe company.

The third line of defence is formed by Flow Traders' Internal Audit department. The third line of defence is formed by Flow Traders' Internal Audit department.

Roles and responsibilities Roles and responsibilities

Flow Traders Management Board is responsible for: Flow Traders Management Board is responsible for:

• ◾ Risk reporting towards the Risk Committee of the Supervisory Board; I Risk reporting towards the Risk Committee ofthe Supervisory Board;
• ◾ Setting companywide objectives; I Setting companywide objectives;
• ◾ Setting boundaries for risk taking by communicating Flow Traders' risk appetite and risk tolerance; I Setting boundaries for risk taking by communicating Flow Traders' risk appetite and risk tolerance;
• ◾ Successfully promoting, sponsoring and coordinating the development of a risk management culture throughout the company; I Successfully promoting, sponsoring and coordinating the development of ^a risk management culture throughout the company;
• ◾ Guiding the inclusion of risk management practices in all strategic and operational decision making; I Guiding the inclusion ofrisk management practices in all strategic and operational decision making;
• ◾ Maintaining and monitoring the effectiveness of the framework to manage, monitor and report risk; I Maintaining and monitoring the effectiveness ofthe frameworkto manage, monitor and report risk;
• ◾ Identifying and evaluating the significant risks related to Flow Traders' Strategy. I Identifying and evaluatingthe significant risks related to Flow Traders' Strategy.

Flow Traders Managing Directors and Global Heads are responsible for: Flow Traders Managing Directors and Global Heads are responsible for:

• ◾ Setting departmental targets and objectives in line with companywide objectives; I Setting departmental targets and objectives in line with companywide objectives;
• ◾ Supporting Flow Traders in the identification, handling, and monitoring of risks related to Flow Traders objectives; I Supporting Flow Traders in the identification, handling, and monitoring of risks related to Flow Traders objectives;
• ◾ Identifying and evaluating the significant risks related to Flow Traders objectives and operations; I Identifying and evaluatingthe significant risks related to Flow Traders objectives and operations;
• ◾ Monitoring risks related to Flow Traders objectives; I Monitoring risks related to Flow Traders objectives;
• ◾ Advising Flow Traders on risk mitigating measures; I Advising Flow Traders on risk mitigating measures;
• ◾ Reporting on risks and risk management towards the Management Board; I Reporting on risks and risk management towards the Management Board;
• ◾ Following up on risk mitigating measures. I Following up on risk mitigating measures.

Flow Traders Local Heads are responsible for: Flow Traders Local Heads are responsible for:

• ◾ Performing annual risk self-assessments to identify, assess, and document existing and new risks and their impact on proposed plans; I Performing annual risk self—assessments to identify, assess, and document existing and new risks and their impact on proposed plans;
• ◾ The adoption of risk management practices; I The adoption ofrisk management practices;
• ◾ Awareness and training on risk management; I Awareness and training on risk management;
• ◾ The results of risk management activities, relevant to their area of responsibility. I The results of risk management activities, relevant to their area of responsibility.

Flow Traders employees are responsible for: Flow Traders employees are responsible for:

• ◾ Identifying areas where risk management practices should be adopted and advising their supervisors accordingly; I Identifying areas where risk management practices should be adopted and advising their supervisors accordingly;
• ◾ Giving input to risk self-assessments to identify, asses, and document existing and new risks and their impact on proposed plans. I Giving input to risk self—assessments to identify, asses, and document existing and new risks and their impact on proposed plans.

Risk reporting Risk reporting

We have a standing risk committee that continuously assesses the risks we face in our business, comprised of our Global Head of Risk and Mid-Office and Management Board. Aside from ongoing ad-hoc communication, there is a recurring meeting set up in which they discuss all risk assessments and risk proposals related to position limits, strategies, procedures, capital requirements and other requirements of prime brokers and market developments. Any major changes to our risk systems, strategies and limit setting must subsequently be approved by the Management Board. There have not been any major failings in the internal risk management and control systems observed during the first half of 2018. Additionally, improvements to the systems are discussed with the Management Board. We have a standing risk committee that continuously assesses the risks we face in our business, comprised of our Global Head of Risk and Mid—Office and Management Board. Aside from ongoing ad—hoc communication, there is a recurring meeting set up in which they discuss all risk assessments and risk proposals related to position limits, strategies, procedures, capital requirements and other requirements of prime brokers and market developments. Any major changes to our risk systems, strategies and limit setting must subsequently be approved by the Management Board. There have not been any major failings in the internal risk management and control systems observed during the first half of 2018. Additionally, improvements to the systems are discussed with the Management Board.

Besides the standing risk committee, the company has a Risk Committee of the Supervisory Board. All members of the Supervisory Board are members of this Risk Committee. The Management Board informs the Risk Committee of the Supervisory Board about the effectiveness of the internal risk management and control systems. This includes the reasonable assurance that the aforementioned systems do not contain any material inaccuracies. In addition, the tasks of the Risk Committee of the Supervisory Board includes supervision and monitoring, as well as advising the Management Board on the operation of the company's internal risk management and control systems. The Risk Committee is also responsible for providing advice to the Management Board on the company's development, performance, and sustainability of its trading strategies. It maintains regular contact with the company's Trading and Risk and Mid-Office departments. Besides the standing risk committee, the company has a Risk Committee ofthe Supervisory Board. All members ofthe Supervisory Board are members ofthis Risk Committee. The Management Board informs the Risk Committee ofthe Supervisory Board about the effectiveness ofthe internal risk management and control systems. This includes the reasonable assurance that the aforementioned systems do not contain any material inaccuracies. In addition, the tasks ofthe Risk Committee ofthe Supervisory Board includes supervision and monitoring, as well as advising the Management Board on the operation of the company's internal risk management and control systems. The Risk Committee is also responsible for providing advice to the Management Board on the company's development, performance, and sustainability of its trading strategies. It maintains regular contact with the company's Trading and Risk and Mid—Office departments.

Following a review of the company's risk assessment processes, the monitoring of the company's internal risk management and control systems has been identified as a priority and as a joint responsibility of the Supervisory Board and all of its committees. All risks relevant to each of the committees of the Supervisory Board are monitored in the Risk Committee of the Supervisory Board. Following ^a review ofthe company's risk assessment processes, the monitoring ofthe company's internal risk management and control systems has been identified as ^a priority and as ajoint responsibility ofthe Supervisory Board and all of its committees. All risks relevant to each of the committees of the Supervisory Board are monitored in the Risk Committee ofthe Supervisory Board.

Key risks Key risks

Market risk Market risk

Market risk is the risk of loss resulting from unfavorable market movements, such as prices, when positions in financial instruments are held. The value of a financial instrument may fluctuate because of changes in factors such as equity prices, currency rates, future dividend expectations, interest rates and volatilities. Our hedging strategies, in combination with the use of straightforward Market risk is the risk of loss resulting from unfavorable market movements, such as prices, when positions in financial instruments are held. The value ofa financial instrument may fluctuate because of changes in factors such as equity prices, currency rates, future dividend expectations, interest rates and volatilities. Our hedging strategies, in combination with the use of straightforward products and continuous monitoring, aim to minimize this risk. Our trading philosophy is that we hedge our positions as perfectly as possible and therefore we minimalize exposures towards market. The Risk and Mid-Office department monitors market risk exposure on a continuous basis (including intraday). Based on the limits set per product or the aggregated risk, limit breaches -if any- will trigger action from the Risk department in order to reduce the risk. In addition, the trading positions are also monitored daily, and the applicable haircuts and margins are computed by our prime brokers. products and continuous monitoring, aim to minimize this risk. Our trading philosophy is that we hedge our positions as perfectly as possible and therefore we minimalize exposures towards market. The Risk and Mid—Office department monitors market risk exposure on ^a continuous basis (including intraday). Based on the limits set per product or the aggregated risk, limit breaches —ifany— will trigger action from the Risk department in orderto reduce the risk. In addition, the trading positions are also monitored daily, and the applicable haircuts and margins are computed by our prime brokers.

Volatility risk (business risk) Volatility risk (business risk)

Our Net Trading Income and profitability are primarily a function of the level of trading activity, or trading volumes, in the financial instruments in which we trade, and the bid-ask spreads (which largely determine the profit on the trade, or margins, we capture). Trading volumes in securities, derivatives and other financial instruments on exchanges and in other trading venues worldwide are directly affected by factors beyond our control, including economic and political conditions, broad trends in business and finance, regulatory requirements, actions by central banks, and changes in the markets in which such transactions occur. To cope with periods of little market movement, we diversify in products and markets traded. This to ensure we are not too depending on the levels of market activity in one asset class or product category. From our experience we know that in these periods some trading desks tend to earn less where others show an increase in earnings. Therefore, these strategies may serve as a (partial) hedge in such circumstances. To control the risk of low market activity, we actively manage our costs and aim to keep our fixed costs low. In addition, we diversify into different markets and products. Our Net Trading Income and profitability are primarily ^a function ofthe level oftrading activity, or trading volumes, in the financial instruments in which we trade, and the bid—ask spreads (which largely determine the profit on the trade, or margins, we capture). Trading volumes in securities, derivatives and other financial instruments on exchanges and in other trading venues worldwide are directly affected by factors beyond our control, including economic and political conditions, broad trends in business and finance, regulatory requirements, actions by central banks, and changes in the markets in which such transactions occur. To cope with periods of little market movement, we diversify in products and markets traded. This to ensure we are not too depending on the levels of market activity in one asset class or product category. From our experience we know that in these periods some trading desks tend to earn less where others show an increase in earnings. Therefore, these strategies may serve as ^a (partial) hedge in such circumstances. To control the risk of low market activity, we actively manage our costs and aim to keep our fixed costs low. In addition, we diversify into different markets and products.

Operational risk Operational risk

Operational risk is defined as the risk of loss arising from inadequate or failed internal processes, people, systems or external events. Operational risk management is an integral part of Flow Traders' management information and control systems. As our operational risks are concentrated in technology events at exchanges and clearing houses, our investment in technology is important to mitigate those associated risks. Operational risk is defined as the risk of loss arising from inadequate orfailed internal processes, people, systems or external events. Operational risk management is an integral part of Flow Traders' management information and control systems. As our operational risks are concentrated in technology events at exchanges and clearing houses, our investment in technology is important to mitigate those associated risks.

We operate an integrated, in-house developed, high-performance and customized technology platform with frequent and controlled deployments of new hardware and software. Our infrastructure has a modular design which allows us to rapidly test and implement improvements in both hardware and software on an ongoing basis. Controlled releases of hardware and software enhancements provide for minimal disruption to our business. The environment in which our trading software (or updates of our trading software) is being developed is strictly separated from the environment in which such trading software operates in production. Access to the source code is strictly controlled and limited. Prior to releasing our trading software, or an update into the production environment, any element of our trading software is subjected to a review of its code, validation in an environment that is separate from our production environment, testing in limited production (processing a strictly limited number of trades) on one trading desk in respect of trading a single financial instrument, followed by more extensive testing across multiple desks and/or trading multiple financial instruments. Each step, and progressing through steps, is documented. We operate an integrated, in—house developed, high—performance and customized technology platform with frequent and controlled deployments of new hardware and software. Our infrastructure has ^a modular design which allows us to rapidly test and implement improvements in both hardware and software on an ongoing basis. Controlled releases of hardware and software enhancements provide for minimaldisruption to our business. The environment in which our trading software (or updates of our trading software) is being developed is strictly separated from the environment in which such trading software operates in production. Access to the source code is strictly controlled and limited. Prior to releasing our trading software, or an update into the production environment, any element of our trading software is subjected to ^a review of its code, validation in an environment that is separate from our production environment, testing in limited production (processing ^a strictly limited number oftrades) on one trading desk in respect oftrading ^a single financial instrument, followed by more extensive testing across multiple desks and/or trading multiple financial instruments. Each step, and progressing through steps, is documented.

Flow Traders has a monitoring system in place to control undisrupted trading activities in real time. Multilayer monitoring is employed to avoid errors, but, when these occur the relevant teams are notified via multiple notification channels. We rely on multiple third party service providers for business and market data. Flow Traders has ^a monitoring system in place to control undisrupted trading activities in realtime. Multilayer monitoring is employed to avoid errors, but, when these occur the relevant teams are notified via multiple notification channels. We rely on multiple third party service providers for business and market data.

Our systems are designed such that they can be monitored real-time, as well as being maintained and supported by qualified professionals from any office. Our risk management system is fully integrated with our trading platform, analysing real-time pricing data, and is designed to ensure that our order activity is conducted within strict pre-determined trading and position limits. For example, our pre-trade risk controls are designed to prevent the trading engines from sending orders which deviate from our pre-defined risk parameters, such as price and volume limits set by the Risk Management department, which keeps our ordering, trading and positions well within tolerance levels. Our monitoring tools reconcile trades, prices and positions against those of our exchanges and prime brokers. Our IT systems are regularly subjected to penetration tests by external experts. We have a comprehensive IT security system that is designed to protect us from attacks both from inside and outside the platform. Our systems are designed such that they can be monitored real—time, as well as being maintained and supported by qualified professionals from any office. Our risk management system isfully integrated with our trading platform, analysing real—time pricing data, and is designed to ensure that our order activity is conducted within strict pre—determined trading and position limits. For example, our pre—trade risk controls are designed to prevent the trading engines from sending orders which deviate from our pre—defined risk parameters, such as price and volume limits set by the Risk Management department, which keeps our ordering, trading and positions well within tolerance levels. Our monitoring tools reconcile trades, prices and positions against those of our exchanges and prime brokers. Our IT systems are regularly subjected to penetration tests by external experts. We have ^a comprehensive IT security system that is designed to protect us from attacks both from inside and outside the platform.

Where we have a technical interface with institutions like our prime brokers and exchanges, the integrity of the connection between the systems and the data that is being exchanged is subject to prior conformance testing and continuous monitoring. Unexpected deviations are flagged and investigated. We also have a disaster recovery plan in place, which, for instance, provides that our Amsterdam office acts as a backup site for other offices. Where we have ^a technical interface with institutions like our prime brokers and exchanges, the integrity ofthe connection between the systems and the data that is being exchanged is subject to prior conformance testing and continuous monitoring. Unexpected deviations are flagged and investigated. We also have a disaster recovery plan in place, which, for instance, provides that our Amsterdam office acts as ^a backup site for other offices.

Regulatory risk Regulatory risk

While we have no clients and do not provide investment services or ancillary services to third parties, our markets and nearly all aspects of our business are heavily regulated. Where applicable, entities forming part of Flow Traders N.V. and its subsidiaries (together referred to as the 'Group') have obtained the regulatory licenses and approvals needed to operate their regulated businesses. While we have no clients and do not provide investment services or ancillary services to third parties, our markets and nearly all aspects of our business are heavily regulated. Where applicable, entities forming part of Flow Traders NV. and its subsidiaries (together referred to as the 'Group') have obtained the regulatory licenses and approvals needed to operate their regulated businesses.

'Our risk management system is fully integrated with our trading platform'

Flow Traders' trading operations are established in four international jurisdictions. As a Group we currently trade on more than 100 venues worldwide. In addition, we operate on various other venues through brokers. As we have to comply with our home regulations and the local regulations and trading rules of all venues on which we trade, our regulatory landscape is vast. Legislators and regulators worldwide strengthen their supervision within our environment, demanding a professional and well-structured compliance organization. Flow Traders' trading operations are established in four internationaljurisdictions. As a Group we currently trade on more than 100 venues worldwide. In addition, we operate on various other venues through brokers. As we have to comply with our home regulations and the local regulations and trading rules of all venues on which we trade, our regulatory landscape is vast. Legislators and regulators worldwide strengthen their supervision within our environment, demanding ^a professionaland well—structured compliance organization.

Our Compliance department assists management and operations at Group and local level by identifying, advising on, reviewing and reporting on regulations. It also seeks to maintain a compliant business environment through training and monitoring in order to ensure and enhance the Group's conformance with its regulatory obligations. The Compliance and Risk and Mid-Office departments have promulgated and implemented pre-trade risk controls, internal rules and regulations that were developed following regulatory requirements, guidelines from market authorities, industry best practices and our own best practices. Our Compliance department assists management and operations at Group and local level by identifying, advising on, reviewing and reporting on regulations. It also seeks to maintain a compliant business environment through training and monitoring in order to ensure and enhance the Group's conformance with its regulatory obligations. The Compliance and Risk and Mid—Office departments have promulgated and implemented pre—trade risk controls, internal rules and regulations that were developed following regulatory requirements, guidelines from market authorities, industry best practices and our own best practices.

Laws and regulations, including tax laws, are subject to change or can be interpreted differently in practice over time. While we believe we are well-positioned to address and implement new or changing regulations in general, and while we spend considerable resources to anticipate and implement new or changing regulations, we typically cannot (fully) assess what the impact of such regulations will eventually be in practice. New regulations or revised interpretations of regulations may or may not be beneficial to our business. Laws and regulations, including tax laws, are subject to change or can be interpreted differently in practice over time. While we believe we are well—positioned to address and implement new or changing regulations in general, and while we spend considerable resources to anticipate and implement new or changing regulations, we typically cannot (fully) assess what the impact of such regulations will eventually be in practice. New regulations or revised interpretations of regulations may or may not be beneficial to our business.

Actual or alleged non-compliance with applicable laws or regulatory requirements could adversely affect our reputation, profitability and prospects. This may also be the case for differences in interpretation or lack of timely or complete implementation of regulatory requirements. Sanctions could include fines, penalties, disgorgements and censures, suspension or expulsion from trading venues or the revocation or limitation of licenses. We aim to minimize such risks by focusing considerable management attention, employing highly-qualified compliance and risk professionals, deploying training, monitoring and reporting Actual or alleged non—compliance with applicable laws or regulatory requirements could adversely affect our reputation, profitability and prospects. This may also be the case for differences in interpretation or lack of timely or complete implementation of regulatory requirements. Sanctions could include fines, penalties, disgorgements and censures, suspension or expulsion from trading venues or the revocation or limitation of licenses. We aim to minimize such risks by focusing considerable management attention, employing highly—qualified compliance and risk professionals, deploying training, monitoring and reporting

systems, and continuously evaluating and implementing current and upcoming regulation on our operations. Notwithstanding such efforts, given the highly regulated nature of our business, we are regularly subject to routine (and sometimes more targeted) inquiries and audits from regulators and trading venues. It is difficult to predict or manage the outcome of such inquiries, although we aim to be as transparent and cooperative as possible given the circumstances. systems, and continuously evaluating and implementing current and upcoming regulation on our operations. Notwithstanding such efforts, given the highly regulated nature of our business, we are regularly subject to routine (and sometimes more targeted) inquiries and audits from regulators and trading venues. It is difficult to predict or manage the outcome of such inquiries, although we aim to be as transparent and cooperative as possible given the circumstances.

We continuously invest in good professional relationships with trading venues, regulators and other relevant parties. Flow Traders is a founding member of the FIA European Principal Traders Association (FIA EPTA), a member of the FIA Principal Traders Group (FIA PTG) in the US and a member of FIA Asia. These are industry groups that consist of leading principal trading firms. We are also a member of the Dutch Association of Proprietary Traders (APT), operating as an industry body of Netherlands-based liquidity providers. As part of these important groups, we continue to promote, foremost, the principle that all markets and market participants should be adequately and transparently regulated. Within these groups we contribute to discussions regarding current and new regulations, including the Investment Firm Regulation and the Investment Firm Directive , MiFID II, Reg AT and market regulations. We will continue to contribute to these discussions and will persist in maximizing transparency in respect of our industry, its benefits for all market participants and fair, orderly and transparent financial markets. We continuously invest in good professional relationships with trading venues, regulators and other relevant parties. Flow Traders is ^a founding member of the FIA European Principal Traders Association(FIA EPTA), ^a member of the FIA PrincipalTraders Group (FIA PTC) in the US and ^a member of FIA Asia. These are industry groups that consist of leading principal trading firms. We are also ^a member of the Dutch Association of Proprietary Traders (APT), operating as an industry body of Netherlands—based liquidity providers. As part of these important groups, we continue to promote, foremost, the principle that all markets and market participants should be adequately and transparently regulated. Within these groups we contribute to discussions regarding current and new regulations, including the Investment Firm Regulation and the Investment Firm Directive, MiFID II, Reg AT and market regulations. We will continue to contribute to these discussions and will persist in maximizing transparency in respect of our industry, its benefits for all market participants and fair, orderly and transparent financial markets.

Statement by the Management Board Statement by the Management Board

As required by section 5:25d of the Dutch Financial Supervision Act (Wet op het financieel toezicht) we state that according to the best of our knowledge: As required by section 5:25d ofthe Dutch Financial Supervision Act (Wet op het financieel toezicht) we state that according to the best of our knowledge:

• ◾ the interim financial statements present a true and fair view of the assets, the liabilities, the financial position and profit or loss of Flow Traders N.V. and the companies included in the consolidation; and I the interim financial statements present ^a true and fair view ofthe assets, the liabilities, the financial position and profit or loss of Flow Traders NV. and the companies included in the consolidation; and
• ◾ the interim financial statements provide a true and fair view of the information required pursuant to article 5:25d paragraph 8 and 9 of the Dutch Financial Supervision Act (Wet op het financieel toezicht). I the interim financial statements provide ^a true and fair view ofthe information required pursuant to article 5:25d paragraph ⁸ and ⁹ ofthe Dutch Financial Supervision Act (Wet op het financieel toezicht).

Amsterdam, 26 July 2018 Amsterdam, 26July 2018

Management Board Management Board

Dennis Dijkstra, Co-CEO Sjoerd Rietberg, Co-CEO Marcel Jongmans, CFO Folkert Joling, CTrO Thomas Wolff, CTO Dennis Dijkstra, Co—CEO Sjoerd Rietberg, Co—CEO MarcelJongmans, CFO Folkertjoling, CTrO Thomas Wolff, CTO

Condensed Consolidated Interim Financial Statements 30 June 2018 Condensed Consolidated Interim Financial Statements 30 June 2018

12 Condensed Consolidated Interim Financial Statements 12 Condensed Consolidated Interim FinancialStatements

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION In thousands of euro CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION In thousands ofeuro

	Note Note	At At 30 June 2018 3OJune 2018	At December 2017 At 31 December 2017 31
Assets Assets
Cash and cash equivalents equivalents and cash Cash		5,264 5,264	5,879 5,879
Financial assets held for trading for trading Financialassets held		3,854,400 3,854,400	3,738,649 3,738,649
Trading receivables Trading receivables		2,789,267 2,789,267	2,126,594 2,126,594
Other receivables Other receivables		13,549 13,549	10,302 10,302
fairvalue Investments fair value through OCI Investments through OCI		1,457 1,457	1,475 1,475
Investments in associates Investments associates in		510 510	571 571
Property equipment Property and equipment and		29,474 29,474	27,325 27,325
Intangible assets Intangible assets		1,432 1,432	1,506 1,506
Current tax assets tax Current assets		4,733 4,733	4,698 4,698
Deferred tax assets Deferred tax assets		2,643 2,643	1,941 1,941
for Assets held for sale Assets held sale	10 10	- —	816 816
Total assets TotaI assets		6,702,729 6,702,729	5,919,756 5,919,756
Liabilities Liabilities
fortrading Financial liabilities held for trading liabilities Financial held		1,691,349 1,691,349	961,180 961,180
Trading payables Trading payables		4,532,117 4,532,117	4,638,107 4,638,107
Other liabilities Other liabilities		101,279 101,279	65,178 65,178
tax liabilities Current tax liabilities Current		9,098 9,098	318 318
tax Deferred tax liabilities Deferred liabilities		791 791	872 872
liabilities TotaI Total liabilities		6,334,634 6,334,634	5,665,655 5,665,655
Equity Equity	12 12
Share capital capital Share		4,653 4,653	4,653 4,653
premium Share premium Share		153,109 153,109	152,456 152,456
Retained earnings Retained earnings		197,756 197,756	86,667 86,667
translation Currency translation reserve Currency reserve		12,888 12,888	10,611 10,611
Fair value reserve Fair value reserve		(311) (311)	(286) (286)
equity TotaI Total equity		368,095 368,095	254,101 254,101
liabilities equity Total and Total equity and liabilities		6,702,729 6,702,729	5,919,756 5,919,756

The notes on pages 17 to 23 are an integral part of these condensed consolidated interim financial statements. The notes on pages ¹⁷ to 23 are an integral part ofthese condensed consolidated interim financial statements.

CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS In thousands of euro CONDENSED CONSOLIDATED STATEMENT ofeuro OF PROFIT ORLOSS in thousands		For the months For the six months ended 30 June six ended 30June
	Note Note	2018 2018	2017 2017
Gross trading income trading income Gross		328,645 328,645	156,047 156,047
Fees related to the trading activities related to the trading activities Fees		34,371 34,371	30,636 30,636
Netfinancialexpenses Net financial expenses related to the trading activities related to the trading activities		27,349 27,349	30,438 30,438
Net trading income Net trading income		266,925 266,925	94,973 94,973
Personnel expenses Personnelexpenses	8 8	87,679 87,679	33,241 33,241
of Depreciation of property and equipment property equipment Depreciation and		3,932 3,932	3,234 3,234
Amortization ofintangible Amortization of intangible assets assets		195 195	178 178
off oftangible Write off of tangible assets Write assets		82 82	22 22
Other expenses Otherexpenses	9 9	25,942 25,942	26,508 26,508
Operating expenses Operating expenses		117,830 117,830	63,183 63,183
result Operating Operating result		149,095 149,095	31,790 31,790
of Result of equity-accounted investees Result equity—accounted investees	10 10	3,080 3,080	17 17
Profit tax before Profit before tax		152,175 152,175	31,807 31,807
Tax expense expense Tax	11 11	25,333 25,333	5,707 5,707
for Profit the period Profit for the period		126,842 126,842	26,100 26,100
Other comprehensive Other comprehensive income income
that profit to Items that are or may be reclassified to profit or loss Items or may reclassified or are be loss
translation differences foreign Foreign currency translation differences – foreign operations Foreign currency operations —		2,276 2,276	(5,515) (5,515)
Changes in investments fair value through OCI investments fair through value Changes in OCI		(25) (25)	94 94
for of the tax) Other comprehensive income year (net Other comprehensive income for the year (net of tax)		2,251 2,251	(5,421) (5,421)
for comprehensive income the year Total comprehensive income for the year Total		129,093 129,093	20,679 20,679
Earnings per share Earnings per share
fully diluted pershare Basic and fully diluted earnings per share and earnings Basic		2.73 2.73	0.56 0.56

The notes on pages 17 to 23 are an integral part of these condensed consolidated interim financial statements. The notes on pages ¹⁷ to 23 are an integral part ofthese condensed consolidated interim financial statements.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY In thousands of euro CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY in thousands ofeuro

	capital Share capital Share	premium Share premium Share	Currency Currency translation translation reserve reserve	Fair value Fair value reserve reserve	Retained Retained earnings earnings	Total Total
at1January Balance at 1 January 2018 Balance 2018	4,653 4,653	152,456 152,456	10,611 10,611	(286) (286)	86,666 86,666	254,100 254,100
Profit Profit	- -	- -	- -	- -	126,842 126,842	126,842 126,842
Total other comprehensive income Total other comprehensive income	- —	- —	2,277 2,277	(25) (25)	- —	2,252 2,252
for Totalcomprehensive the income period Total comprehensive income for the period	- —	- —	2,277 2,277	(25) (25)	126,842 126,842	129,094 129,094
ofthe with Transactions with owners of the Company Transactions owners Company
Share premium premium Share	- —	653 653	- —	- —	- —	653 653
Dividends Dividends	- —	- —	- —	- —	(16,287) (16,287)	16,287 16,287
Other Other	- -	- -	- -	- -	534 534	534 534
ofthe Totaltransactions with company owners Total transactions with owners of the company	- —	653 653	- —	- —	(15,753) (15,753)	15,100 15,100
at Balance Balance at 30 June 2018 301une 2018	4,653 4,653	153,109 153,109	12,888 12,888	(311) (311)	197,755 197,755	368,094 368,094

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY In thousands of euro CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY In thousands ofeuro

	capital Share capital Share	premium Share premium Share	Currency Currency translation translation reserve reserve	Fair value Fair value reserve reserve	Retained Retained earnings earnings	Total Total
at Balance at 1 January 2017 Balance 1January 2017	4,653 4,653	152,456 152,456	19,533 19,533	(438) (438)	93,887 93,887	270,091 270,091
Profit Profit	- -	- -	- -	- -	26,100 26,100	26,100 26,100
other comprehensive income Total other comprehensive income Total	- —	- —	(5,515) (5,515)	94 94	- —	(5,421) (5,421)
for Totalcomprehensive the period Total comprehensive income for the period income		- —	(5,515) (5,515)	94 94	26,100 26,100	20,679 20,679
ofthe Transactions with owners of the Company Transactions with owners Company
Dividends Dividends	- —	- —	- —	- —	(32,572) (32,572)	(32,572) (32,572)
of Total transactions with the owners company Total transactions with owners of the company	- —	- —	- —	- —	(32,572) (32,572)	(32,572) (32,572)
at Balance 301une Balance at 30 June 2017 2017	4,653 4,653	152,456 152,456	14,018 14,018	(344) (344)	87,415 87,415	258,198 258,198

The notes on pages 17 to 23 are an integral part of these condensed consolidated interim financial statements. The notes on pages ¹⁷ to 23 are an integral part ofthese condensed consolidated interim financial statements.

INTERIM CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS In thousands of euro CONDENSED CONSOLIDATED STATEMENT ofeuro OF CASH FLOWS in thousands	For the six months 30June For the six months ended 30 June ended
	2018 2018	2017 2017
from flows operating activities Cash flows from operating activities Cash
for Profit the period Profit for the period	126,842 126,842	26,100 26,100
Adjusted for: Adjusted for:
of Depreciation of property and equipment property equipment Depreciation and	3,932 3,932	3,234 3,234
ofintangible Amortization of intangible assets Amortization assets	195 195	178 178
off of Write off of (in)tangible assets Write (in)tangible assets	82 82	22 22
oftax) of Result/(impairment) of equity-accounted investees (net of tax) Result/(impairment) (net equity—accounted investees	(73) (73)	(17) (17)
Netfinancialexpenses to trading Net financial expenses related to the trading activities related the activities	27,349 27,349	30,438 30,438
Tax expense expense Tax	25,333 25,333	5,707 5,707
Changes in working capital Changes in working capital Changes in working capital
I for (increase)/decrease financial assets held for trading (increase)/decrease financial assets held for trading (increase)/decrease financial held trading assets ◾ ◾	(115,751) (115,751) (115,751)	751,431 751,431 751,431
I (increase)/decrease trading receivables (increase)/decrease trading receivables trading (increase)/decrease receivables ◾ ◾	(662,673) (662,673) (662,673)	932,818 932,818 932,818
I (increase)/decrease other receivables (increase)/decrease other receivables (increase)/decrease other receivables ◾ ◾	(2,431) (2,431) (2,431)	2,089 2,089 2,089
I fortrading financial liabilities increase/(decrease) financial liabilities held for trading increase/(decrease) financial liabilities held for trading increase/(decrease) held ◾ ◾	730,169 730,169 730,169	(92,515) (92,515) (92,515)
I trading increase/(decrease) trading payables increase/(decrease) trading payables increase/(decrease) payables ◾ ◾	(105,990) (105,990) (105,990)	(1,521,034) (1,521,034) (1,521,034)
I increase/(decrease) other liabilities increase/(decrease) other liabilities other liabilities increase/(decrease) ◾ ◾	34,345 34,345 34,345	(51,959) (51,959) (51,959)
I increase/(decrease) other increase/(decrease) other increase/(decrease) other ◾ ◾	2,752 2,752 2,752	(4,987) (4,987) (4,987)
Cash flow from opera business Cash flow from business operations Cash flow from business operations 81,505	64,018 64,081	81,505 81,505
Interest Interest paid paid	(28,375) (28,375)	(30,438) (30,438)
Interest Interest received received	1,026 1,026	- —
Corporate income tax paid tax Corporate income paid	(17,371) (17,371)	(11,825) (11,825)
activities in)/prouided by operating Cash (used in)/provided by operating activities (used Cash	19,361 19,361	39,242 39,242

INTERIM CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS In thousands of euro CONDENSED CONSOLIDATED STATEMENT ofeuro OF CASH FLOWS in thousands		For the six months For the six months ended 30 June ended 30June
	2018 2018	2017 2017
from flows investing activities Cash flows from investing activities Cash
ofproperty equipment Acquisition of property and equipment Acquisition and	(3,248) (3,248)	(5,781) (5,781)
ofintangible Acquisition of intangible assets Acquisition assets	(119) (119)	(158) (158)
Net in)/provided investing activities by Net cash (used in)/provided by investing activities cash (used	(3,367) (3,367)	(5,939) (5,939)
flows from activities Cash flows from financing activities financing Cash
Financial lease Financial lease	(954) (954)	(365) (365)
Dividend paid Dividend paid	(16,287) (16,287)	(32,572) (32,572)
contributions Capital contributions Capital	653 653	- —
Net in)/provided financing activities by Net cash (used in)/provided by financing activities cash (used	(16,588) (16,588)	(32,937) (32,937)
Effect of Effect of movements in exchange rates on cash and cash equivalents movements exchange equivalents rates on cash and cash in	(21) (21)	(55) (55)
Net equivalents Net change in cash and cash equivalents change in cash and cash	(615) (615)	311 311
Changes in cash Changes cash in
Cash and cash equivalents at opening equivalents at opening and cash Cash	5,879 5,879	2,736 2,736
Cash and cash equivalents at close equivalents at close and cash Cash	5,264 5,264	3,047 3,047
Changes in cash Changes in cash	(615) (615)	311 311

Notes to the condensed consolidated interim financial statements Notes to the condensed consolidated interim financial statements

All amounts in thousands of euro, unless stated otherwise. All amounts In thousands ofeuro, unless stated otherwise.

1. Reporting entity 1. Reporting entity

Flow Traders N.V. (referred to as the 'Company') is a public limited liability company (naamloze vennootschap). It is incorporated under the laws of the Netherlands, having its seat (statutaire zetel) in Amsterdam, the Netherlands, and its registered office at Jacob Bontiusplaats 9, 1018 LL Amsterdam, the Netherlands and registered with the Trade Register of the Chamber of Commerce (Kamer van Koophandel) under number 34294936. Flow Traders N.V. (referred to as the 'Company') is ^a public limited liability company (naamloze vennootschap). It is incorporated underthe laws ofthe Netherlands, having its seat (statutaire zetel) in Amsterdam, the Netherlands, and its registered office atJacob Bontiusplaats 9,1018 LL Amsterdam, the Netherlands and registered with the Trade Register ofthe Chamber of Commerce (Kamer van Koophandel) under number 34294936.

These condensed consolidated interim financial statements comprise the Company and its subsidiaries (together referred to as the 'Group'). The Group is a leading global technologyenabled liquidity provider that specializes in exchange traded products (ETPs). The Group's goal is to be a leading ETP-focused liquidity provider. These condensed consolidated interim financial statements comprise the Company and its subsidiaries (together referred to as the 'Group'). The Group is ^a Leading global technology enabled liquidity provider that specializes in exchange traded products (ETPs). The Group's goal is to be a leading ETP—focused liquidity provider.

The condensed consolidated interim financial statements of the Group for the six months period ended 30 June 2018 incorporate financial information of Flow Traders N.V., its controlled entities and interests in associates. The condensed consolidated interim financial statements were authorised for issue by the Company's Management Board and the Supervisory Board on 26 July 2018. The condensed consolidated interim financial statements of the Group for the six months period ended 30 June 2018 incorporate financial information of Flow Traders N.V., its controlled entities and interests in associates. The condensed consolidated interim financial statements were authorised for issue by the Company's Management Board and the Supervisory Board on 26July 2018.

2. Basis of preparation 2. Basis ofpreparatian

These condensed consolidated interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the European Union. They do not include all the information required for a complete set of IFRS financial statements. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Group's financial position and performance since the last annual consolidated financial statements as at and for the year ended 31 December 2017. These condensed consolidated interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the European Union. They do not include all the information required fora complete set of IFRS financial statements. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding ofthe changes in the Group's financial position and performance since the last annual consolidated financial statements as at and for the year ended ³¹ December 2017.

In these condensed consolidated interim financial statements, IFRS 9 and IFRS 15 have been applied for the first time. These new standards however have no impact on the reported figures. All other accounting policies are the same as those applied in the Group's consolidated financial statements as at and for the year ended 31 December 2017. In these condensed consolidated interim financial statements, IFRS 9 and IFRS 15 have been applied for the first time. These new standards however have no impact on the reported figures. All other accounting policies are the same as those applied in the Group's consolidated financial statements as at and for the year ended ³¹ December 2017.

The board report as set out on pages 4 to 10 is integral part of these condensed consolidated interim financial statements. The board report as set out on pages 4 to 10 is integral part ofthese condensed consolidated interim financialstatements.

3. Hedge accounting 3. Hedge accounting

During the first half of 2018 the Group applied hedge accounting to cover for part of their capital contributions in the US entities. During the first half of 2018 the Group applied hedge accounting to cover for part oftheir capital contributions in the US entities.

4. Operating segments 4. Operating segments

The Group has the following regions through which the Group operates via its local subsidiaries in the Netherlands, Romania (together Europe), United States of America (Americas) and Singapore and Hong Kong (Asia). The Group has the following regions through which the Group operates via its local subsidiaries in the Netherlands, Romania (together Europe), United States ofAmerica (Americas) and Singapore and Hong Kong (Asia).

The Group's trading assets and liabilities attributable to each segment are reported to management on the basis of net liquidity. Consequently, the reported total assets in each segment are net of the segment's financial liabilities held for trading and trading payables. The Group's trading assets and liabilities attributable to each segment are reported to management on the basis of net liquidity. Consequently, the reported total assets in each segment are net ofthe segment's financial liabilities held for trading and trading payables.

SEGMENT REPORTING SEGMENT REPORTING		For the six	months ended For the six months ended 30 June 2018	30June 2018	SEGMENT REPORTING SEGMENT REPORTING		For the six	months ended For the six months ended 30 June 2017	3OJune 2017
	Europe Europe	Americas Americas	Asia Asia	Total Total		Europe Europe	Americas Americas	Asia Asia	Total Total
Gross trading income trading income Gross	115,502 115,502	188,996 188,996	24,147 24,147	328,645 328,645	Gross trading income trading income Gross	98,336 98,336	44,636 44,636	13,075 13,075	156,047 156,047
Fees related to the trading activities related to the trading activities Fees	18,141 18,141	12,566 12,566	3,664 3,664	34,371 34,371	Fees related to the trading activities related to the trading activities Fees	17,994 17,994	10,155 10,155	2,487 2,487	30,636 30,636
Net financial expenses related to the financial to Net expenses related the					Net financial expenses related to the financial related to the Net expenses
trading activities trading activities	15,483 15,483	9,060 9,060	2,806 2,806	27,349 27,349	trading activities trading activities	14,665 14,665	13,141 13,141	2,632 2,632	30,438 30,438
Net tradingincome Net trading income	81,878 81,878	167,370 167,370	17,677 17,677	266,925 266,925	Net tradingincome Net trading income	65,677 65,677	21,340 21,340	7,956 7,956	94,973 94,973
Intercompany recharge Intercompany recharge	84,147 84,147	- —	- —	84,147 84,147	Intercompany recharge Intercompany recharge	2,526 2,526		- —	2,526 2,526
Total Total revenue revenue	166,025 166,025	167,370 167,370	17,677 17,677	351,072 351,072	Total Total revenue revenue	68,203 68,203	21,340 21,340	7,956 7,956	97,499 97,499
Personnel expenses Personnel expenses	63,279 63,279	19,361 19,361	5,039 5,039	87,679 87,679	Personnel expenses Personnel expenses	21,695 21,695	7,916 7,916	3,630 3,630	33,241 33,241
of Depreciation of property and Depreciation property and					of Depreciation of property and Depreciation property and
equipment equipment	2,276 2,276	992 992	664 664	3,932 3,932	equipment equipment	2,054 2,054	765 765	415 415	3,234 3,234
of Amortization intangible Amortization of intangible assets assets	160 160	8 8	27 27	195 195	of Amortization intangible Amortization of intangible assets assets	147 147	14 14	17 17	178 178
off of tangible Write off of (in) tangible assets Write assets (in)	- —	82 82	- —	82 82	off of tangible Write off of (in) tangible assets Write assets (in)	1 1	- —	21 21	22 22
Intercompany recharge Intercompany recharge	- —	81,159 81,159	2,988 2,988	84,147 84,147	Intercompany recharge Intercompany recharge	- —	2,193 2,193	333 333	2,526 2,526
Other expenses Otherexpenses	10,364 10,364	10,803 10,803	4,775 4,775	25,942 25,942	Other expenses Otherexpenses	12,571 12,571	10,215 10,215	3,722 3,722	26,508 26,508
Operating expenses Operating expenses	76,079 76,079	112,405 112,405	13,493 13,493	201,977 201,977	Operating expenses Operating expenses	36,468 36,468	21,103 21,103	8,138 8,138	65,709 65,709
result Operating Operating result	89,946 89,946	54,965 54,965	4,184 4,184	149,095 149,095	result Operating Operating result	31,735 31,735	237 237	(182) (182)	31,790 31,790
of Result of equity-accounted investees Result equity—accounted investees	3,154 3,154	(74) (74)	- —	3,080 3,080	of Result of equity-accounted investees Result equity—accounted investees	17 17	- —	- —	17 17
Profit tax before Profit before tax	93,100 93,100	54,891 54,891	4,184 4,184	152,175 152,175	Profit tax before Profit before tax	31,752 31,752	237 237	(182) (182)	31,807 31,807
Tax expense expense Tax	12,532 12,532	12,059 12,059	740 740	25,331 25,331	Tax expense expense Tax	5,627 5,627	83 83	(3) (3)	5,707 5,707
Profit for the period Profit for the period	80,568 80,568	42,832 42,832	3,444 3,444	126,844 126,844	Profit for the period Profit for the period	26,125 26,125	154 154	(179) (179)	26,100 26,100
Assets Assets	343,053 343,053	99,907 99,907	36,303 36,303	479,263 479,263	Assets Assets	214,707 214,707	73,746 73,746	34,914 34,914	323,367 323,367
Liabilities Liabilities	77,135 77,135	27,363 27,363	6,671 6,671	111,169 111,169	Liabilities Liabilities	42,486 42,486	16,916 16,916	5,766 5,766	65,168 65,168

				SEGMENT REPORTING			For the six months ended 30 June 2017
Europe Europe	Americas Americas	Asia Asia	Total Total		Europe Europe	Americas Americas	Asia Asia	Total Total
				Gross trading income	98,336	44,636	13,075	156,047
				Fees related to the trading activities	17,994	10,155	2,487	30,636
				Net financial expenses related to the
				trading activities	14,665	13,141	2,632	30,438
				Net trading income	65,677	21,340	7,956	94,973
				Intercompany recharge	2,526		-	2,526
				Total revenue	68,203	21,340	7,956	97,499
				Personnel expenses	21,695	7,916	3,630	33,241
				Depreciation of property and
				equipment	2,054	765	415	3,234
				Amortization of intangible assets	147	14	17	178
				Write off of (in) tangible assets	1	-	21	22
				Intercompany recharge	-	2,193	333	2,526
				Other expenses	12,571	10,215	3,722	26,508
				Operating expenses	36,468	21,103	8,138	65,709
				Operating result	31,735	237	(182)	31,790
				Result of equity-accounted investees	17	-	-	17
				Profit before tax	31,752	237	(182)	31,807
				Tax expense	5,627	83	(3)	5,707
				Profit for the period	26,125	154	(179)	26,100
				Assets	214,707	73,746	34,914	323,367
				Liabilities	42,486	16,916	5,766	65,168

5. Fair values of financial instruments 5. Fair values of financial instruments

Fair values have been determined for measurement and/or disclosure purposes based on the following methods. When applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability. Fair values have been determined for measurement and/or disclosure purposes based on the following methods. When applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.

Valuation models Valuation models

The Group measures fair values using the following fair value hierarchy, depending on the inputs used for making the measurements. The Group measures fair values using the following fair value hierarchy, depending on the inputs used for making the measurements.

• ◾ Level 1: inputs that are quoted, unadjusted, market prices in active markets for identical instruments; I Level 1: inputs that are quoted, unadjusted, market prices in active markets for identical instruments,-
• ◾ Level 2: inputs, other than within Level 1, that are observable either directly (i.e. as prices) or indirectly (i.e. derived from prices). This category includes instruments valuated using: quoted market prices in active markets for similar instruments; quoted prices for identical or similar instruments in markets that are considered inactive; or other valuation techniques in which all significant inputs are directly or indirectly observable market data; I Level2: inputs, other than within LevelT, that are observable either directly (i.e. as prices) or indirectly (i.e. derived from prices). This category includes instruments valuated using: quoted market prices in active markets for similar instruments; quoted prices for identical or similar instruments in markets that are considered inactive; or other valuation techniques in which all significant inputs are directly or indirectly observable market data,-
• ◾ Level 3: inputs that are unobservable. This category includes all instruments for which the valuation technique includes unobservable inputs that have a significant effect on the instrument's valuation. This category includes instruments that are valuated based on quoted prices for similar instruments for which significant unobservable adjustments or assumptions are required to reflect differences between the instruments. I Level 3: inputs that are unobservable. This category includes all instruments for which the valuation technique includes unobservable inputs that have ^a significant effect on the instrument's valuation. This category includes instruments that are valuated based on quoted prices for similar instruments for which significant unobservable adjustments or assumptions are required to reflect differences between the instruments.

The objective of valuation techniques is to arrive at a fair value measurement that reflects the price that would be received to sell the asset or paid to transfer the liability in an orderly transaction between independent market participants at the measurement date. The objective of valuation techniques is to arrive at ^a fair value measurement that reflects the price that would be received to sell the asset or paid to transfer the liability in an orderly transaction between independent market participants at the measurement date.

The Group uses widely recognized valuation techniques and models (including net present value models and comparisons with similar instruments for which market observable prices exist) for determining the fair value of common, simple financial instruments that use only observable market data and require little management judgement and estimation. Observable prices or model inputs (including risk-free and benchmark interest rates and credit spreads used in estimating discount rates, bond and equity prices, foreign currency exchange rates, equity and equity index prices and expected price volatilities and correlations) are usually available in the market for listed debt and equity securities, exchange-traded derivatives and The Group uses widely recognized valuation techniques and models (including net present value models and comparisons with similar instruments for which market observable prices exist) for determining the fair value of common, simple financial instruments that use only observable market data and require little managementjudgement and estimation. Observable prices or model inputs (including risk—free and benchmark interest rates and credit spreads used in estimating discount rates, bond and equity prices, foreign currency exchange rates, equity and equity index prices and expected price volatilities and correlations) are usually available in the market for listed debt and equity securities, exchange—traded derivatives and

simple over-the-counter derivatives. Availability of observable market prices and model inputs reduces the need for management judgement and estimation and thus reduces the uncertainty associated with determining fair values. Availability of observable market prices and inputs varies depending on the products and markets and is prone to changes based on specific events and general conditions in the financial markets. simple over—the—counter derivatives. Availability of observable market prices and model inputs reduces the need for managementjudgement and estimation and thus reduces the uncertainty associated with determining fair values. Availability of observable market prices and inputs varies depending on the products and markets and is prone to changes based on specific events and general conditions in the financial markets.

When the Group measures portfolios of financial assets and financial liabilities on the basis of net exposures to market risks, it applies judgement in determining appropriate portfolio-level adjustments such as bid-ask spreads. Such adjustments are derived from observable bid-ask spreads for similar instruments and adjusted for factors specific to the portfolio. Similarly, when the Group measures portfolios of financial assets and financial liabilities on the basis of net exposure to the credit risk of a particular counterparty, it takes into account any existing arrangements that mitigate the credit risk exposure (e.g. master netting agreements with the counterparty). When the Group measures portfolios of financial assets and financial liabilities on the basis of net exposures to market risks, it appliesjudgement in determining appropriate portfolio—level adjustments such as bid—ask spreads. Such adjustments are derived from observable bid—ask spreads for similar instruments and adjusted for factors specific to the portfolio. Similarly, when the Group measures portfolios offinancial assets and financial liabilities on the basis of net exposure to the credit risk ofa particular counterparty, it takes into account any existing arrangements that mitigate the credit risk exposure (e.g. master netting agreements with the counterparty).

Valuation framework Valuation framework

The Group has a control framework with respect to the measurement of fair values. This framework includes a Risk and Mid-Office department which is independent of the Trading department and reports directly to the Management Board. The Risk and Mid-Office department has overall responsibility for independently verifying the results of trading and all significant fair value measurements. The daily reconciliation of the positions and prices between the prime brokers and the Trading department is most important. The Group has ^a control framework with respect to the measurement of fair values. This framework includes ^a Risk and Mid—Office department which is independent ofthe Trading department and reports directly to the Management Board. The Risk and Mid—Office department has overall responsibility for independently verifying the results oftrading and all significant fair value measurements. The daily reconciliation of the positions and prices between the prime brokers and the Trading department is most important.

The prime brokers of the Group provide electronic position statements on a daily basis, which are uploaded automatically into the Group's databases. The Group and its prime brokers agreed when files will be available and methods for transmission and communication. All data is normalized by the Group so it can be used in multiple internal systems. The information is mainly used for daily independent reconciliation of positions and prices, resulting in profit and loss accounts. The prime brokers ofthe Group provide electronic position statements on ^a daily basis, which are uploaded automatically into the Group's databases. The Group and its prime brokers agreed when files will be available and methods for transmission and communication. All data is normalized by the Group so it can be used in multiple internal systems. The information is mainly used for daily independent reconciliation of positions and prices, resulting in profit and loss accounts.

The following reconciliations are executed on a daily basis: The following reconciliations are executed on ^a daily basis:

• ◾ reconciliation of the positions The Risk and Mid-Office department reconciles the positions of the Trading department with information provided by the prime brokers. All differences are reconciled and agreed by the Trading department of the Group and the prime brokers; I reconciliation ofthe positions — The Risk and Mid—Office department reconciles the positions ofthe Trading department with information provided by the prime brokers. All differences are reconciled and agreed by the Trading department of the Group and the prime brokers;
• ◾ reconciliation of prices The Risk and Mid-Office department reconciles prices as provided by the Trading Department with those of the prime brokers and/or data from external data vendors. All differences are reconciled and the Risk and Mid-Office department makes sure that any required follow up action is taken, either by the prime broker or the Trading department. Therefore, all prices are checked with independent sources. I reconciliation of prices — TheRisk and Mid—Office department reconciles prices as provided by the Trading Department with those of the prime brokers and/or data from external data vendors. All differences are reconciled and the Risk and Mid—Office department makes sure that any required follow up action is taken, either by the prime broker or the Trading department. Therefore, all prices are checked with independent sources.

Results of these reconciliation processes are communicated and agreed with Heads of Trading, the Risk and Mid-Office department and the Management Board on a daily basis. Results of these reconciliation processes are communicated and agreed with Heads ofTrading, the Risk and Mid—Office department and the Management Board on a daily basis.

a) Financial assets and liabilities held for trading a) Financial assets and liabilities held for trading

The Group mainly trades on regulated and active markets. The financial assets and liabilities held for trading are carried at fair value, based whenever possible on quoted market prices, as published by exchanges, market data vendors and prime brokers. The Group mainly trades on regulated and active markets. The financial assets and liabilities held for trading are carried at fair value, based whenever possible on quoted market prices, as published by exchanges, market data vendors and prime brokers.

The valuation of trading positions, both the long and the short positions, is determined by reference to last traded prices from similar instruments from the exchanges at the reporting date. Such financial assets and liabilities are classified as Level 1. The valuation oftrading positions, both the long and the short positions, is determined by reference to last traded prices from similar instruments from the exchanges at the reporting date. Such financial assets and liabilities are classified as Level 1.

A substantial part of the financial assets and liabilities held for trading are carried at fair value, based on theoretical prices which can differ from quoted market prices. The theoretical prices reflect price adjustments primarily caused by the fact that the Group continuously prices its financial assets and liabilities based on all available information. This includes prices for identical and near-identical positions, as well as the prices for securities underlying the Group's positions, on other exchanges that are open after the exchange on which the financial asset or liability is traded closes. The Group's Risk and Mid-Office department checks the theoretical price independently. As part of its review, It monitors whether all price adjustments can be substantiated with market inputs. Consequently, such financial assets and liabilities are classified as Level 2. A substantial part ofthe financial assets and liabilities held for trading are carried at fair value, based on theoretical prices which can differ from quoted market prices. The theoretical prices reflect price adjustments primarily caused by the fact that the Group continuously prices its financial assets and liabilities based on all available information. This includes prices for identical and near—identical positions, as well as the prices for securities underlying the Group's positions, on other exchanges that are open after the exchange on which the financial asset or liability is traded closes. The Group's Risk and Mid—Office department checks the theoretical price independently. As part of its review, It monitors whether all price adjustments can be substantiated with market inputs. Consequently, such financial assets and liabilities are classified as Level 2.

For offsetting (delta neutral) positions, the Group uses mid-market prices to determine fair value. For offsetting (delta neutral) positions, the Group uses mid—market prices to determine fair value.

b) Investments fair value through OCI b) Investments fair value through CO

The fair value of these investments is determined by reference to their quoted closing bid price at the reporting date, or if unquoted, determined using a valuation technique and are classified as Level 2. The fair value of these investments is determined by reference to their quoted closing bid price at the reporting date, or if unquoted, determined using ^a valuation technique and are classified as Level2.

c) Other receivables c) Other receivables

The carrying value of other receivables with a maturity of less than one year is assumed to approximate their fair values. The carrying value of other receivables with ^a maturity of less than one year is assumed to approximate their fair values.

Fair value hierarchy Fair value hierarchy

			At	30June At 30 June 2018 2018
	Level 1 Level1	Level 2 Level 2	Level 3 Level 3	Total Total
Long positions in cash market market Long positions cash in
products products	172,501 172,501	3,668,072 3,668,072	- -	3,840,573 3,840,573
Mark to market derivatives assets to market derivatives Mark assets	6,806 6,806	7,021 7,021	- —	13,827 13,827
for trading Financial assets held Financial assets held for trading	179,307 179,307	3,675,093 3,675,093	- —	3,854,400 3,854,400
fair through Investments fair value through OCI Investments value OCI	- —	1,457 1,457	- —	1,457 1,457
Total long positions Total long positions	179,307 179,307	3,676,550 3,676,550	- —	3,855,857 3,855,857
Short positions in cash market Short positions market cash in
products products	20,753 20,753	1,670,596 1,670,596	- -	1,691,349 1,691,349
Mark to market derivatives liabilities Mark to market derivatives liabilities	- —	- —	- —	- —
short positions Total Total short positions	20,753 20,753	1,670,596 1,670,596	- —	1,691,349 1,691,349

			At 31	At 31 December 2017 December 2017
	Level 1 Level1	Level2 Level 2	Level 3 Level 3	Total Total
Long positions in cash market positions market Long cash in
products products	371,712 371,712	3,366,149 3,366,149	- -	3,737,861 3,737,861
Markto Mark to market derivatives assets market derivatives assets	- —	788 788	- —	788 788
for Financialassets trading Financial assets held for trading held	371,712 371,712	3,366,937 3,366,937	- —	3,738,649 3,738,649
fairvalue Investments fair value through OCI Investments through OCI	- —	1,475 1,475	- —	1,475 1,475
long positions Total long positions Total	371,712 371,712	3,368,412 3,368,412	- —	3,740,124 3,740,124
Short positions in cash market Short positions market cash in
products products	61,021 61,021	900,159 900,159	- -	961,180 961,180
Markto market Mark to market derivatives liabilities derivatives liabilities	- —	- —	- —	- —
short positions Total Total short positions	61,021 61,021	900,159 900,159	- —	961,180 961,180

Due to the short holding period between acquisition and sale, there are no transfers between Level 1 and Level 2. There are no Level 3 positions. Due to the short holding period between acquisition and sale, there are no transfers between Level1 and Level2. There are no Level ³ positions.

6. Hedge accounting 6. Hedge accounting

Included in the financial liabilities held for trading as per 30 June there was a borrowing of USD 20 million which is designated as a hedge of the net investments in the United States subsidiaries, which have their functional currencies in USD. During the six months ended 30 June 2018 an amount of €0.9 million was transferred to other comprehensive income to offset the losses on translation of the net investments in the subsidiaries. There was no ineffectiveness in the period ended 30 June 2018. Included in the financial liabilities held for trading as per 30 June there was ^a borrowing of USD 20 million which is designated as ^a hedge of the net investments in the United States subsidiaries, which have theirfunctional currencies in USD. During the six months ended 30June 2018 an amount of€0.9 million was transferred to other comprehensive income to offset the losses on translation ofthe net investments in the subsidiaries. There was no ineffectiveness in the period ended 30 June 2018.

7. Earnings per share 7. Earnings per share

The calculation of the earnings per share has been based on the profit for the year attributable to ordinary shareholders and the number of ordinary shares outstanding. The calculation ofthe earnings per share has been based on the profit for the year attributable to ordinary shareholders and the number of ordinary shares outstanding.

EARNINGS PER SHARE EARNINGS PER SHARE	For the months For the six months ended 30 June six ended 30June
	2018 2018	2017 2017
forthe Profit for the year Profit year	126,842 126,842	26,100 26,100
Profit attributable ordinary to shareholders Profit attributable to ordinary shareholders	126,842 126,842	26,100 26,100
of Weighted average number of shares Weighted number average shares
9july at ordinary converted issued shares Issued ordinary shares converted at 9 July 2015 2015	46,534,500 46,534,500	46,534,500 46,534,500
fully diluted earnings per Basic and fully diluted earnings per share and share Basic	2.73 2.73	0.56 0.56

8. Personnel expenses 8. Personnel expenses

	For the months For the six months ended 30 June six ended 30June
	2018 2018	2017 2017
Wages and salaries Wages and salaries	12,771 12,771	11,069 11,069
Bonuses Bonuses	70,038 70,038	17,347 17,347
Social security charges Social security charges	1,567 1,567	1,325 1,325
Recruitmentand otheremployment Recruitment and other employment costs costs	3,303 3,303	3,499 3,499
Personnel expenses Personnel expenses	87,679 87,679	33,241 33,241

9. Other expenses 9. Other expenses

	For the six months ended 30June For the six months ended 30 June
	2018 2018	2017 2017
Technology Technology	17,515 17,515	18,766 18,766
Housing Housing	2,894 2,894	1,963 1,963
Advisors and assurance Advisors and assurance	900 900	925 925
Regulatory costs Regulatory costs	829 829	757 757
Fixed exchange costs Fixed exchange costs	2,348 2,348	2,298 2,298
Various expenses Various expenses	1,456 1,456	1,799 1,799
Other expenses Other expenses	25,942 25,942	26,508 26,508

10. Assets held for sale 10. Assets held for sale

As per 31 December 2017 the 24% ownership in Think ETF Asset Management BV is reclassified to the 'assets held for sale' category on the balance sheet. On 19 January 2018 the company announced the signing of a Share Purchase Agreement. This deal is closed as per 29 June 2018 and therefore no longer part of the Flow Traders Group. As per ³¹ December 2017 the 24% ownership in Think ETF Asset Management BV is reclassified to the 'assets held for sale' category on the balance sheet. On ¹⁹ January 2018 the company announced the signing ofa Share Purchase Agreement. This deal is closed as per 29 June 2018 and therefore no longer part of the Flow Traders Group.

In our segment reporting this subsidiary was included in the Europe segment. In our segment reportingthis subsidiary was included in the Europe segment.

11. Taxation 11. Taxation

Tax expense is recognised based on management's best estimate of the weighted-average annual income tax rate expected for the full financial year multiplied by the pre-tax income of the interim reporting period. Tax expense is recognised based on management's best estimate ofthe weighted—average annual income tax rate expected for the full financialyear multiplied by the pre—tax income of the interim reporting period.

The Group's estimated consolidated effective tax rate for the first half year ended 30 June 2018 is 16.6% (first half year ended 30 June 2017: 17.9%). The Group's estimated consolidated effective tax rate for the first halfyear ended 30 June 2018 is 16.6% (first halfyear ended 30 June 2017: 17.9%).

12. Equity 12. Equity

Share capital and share premium Share capital and share premium

All ordinary shares rank equally with regard to the Company's residual assets. There are no preferred shareholders. All ordinary shares rank equally with regard to the Company's residual assets. There are no preferred shareholders.

ORDINARY SHARES ORDINARY SHARES	2018 2018	2017 2017
In issue 1 January issue1January In	46,534,500 46,534,500	46,534,500 46,534,500
to Member capital converted to shares at conversion to N.V. Member capital converted at conversion to shares N.V.	- —	- —
Total Total	46,534,500 46,534,500	46,534,500 46,534,500

Ordinary shares Ordinary shares

Holders of the Company's ordinary shares are entitled to dividends and are entitled to one vote per share at general meetings of the Company. Holders ofthe Company's ordinary shares are entitled to dividends and are entitled to one vote per share at general meetings ofthe Company.

Total authorized capital of the Company is €10 million consisting of 100 million shares of which currently 46,534,500 shares are issued. The nominal value per share is €0.10 each, and therefore the issued and paid up capital amounts to €4,653,000. Total authorized capital ofthe Company is €10 million consisting of100 million shares of which currently 46,534,500 shares are issued. The nominal value per share is €0.10 each, and therefore the issued and paid up capital amounts to €4,653,000.

Shares acquired by participants in 2015 as part of the EEP 2015 are subject to a lock-up period. When a participant leaves the Company before the end of the lock-up period, the participant must offer any such unreleased shares to the Company at the lower of the price paid by the participant or the market price. During 2017 and 2018 these shares were used the Flow Loyalty Incentive Plan whereby all employees receive 100 share in the company at their two years working anniversary. Shares acquired by participants in 2015 as part ofthe EEP 2015 are subject to ^a lock—up period. When ^a participant leaves the Company before the end ofthe lock—up period, the participant must offer any such unreleased shares to the Company at the lower ofthe price paid by the participant or the market price. During 2017 and 2018 these shares were used the Flow Loyalty Incentive Plan whereby all employees receive 100 share in the company at their two years working anniversary.

Treasury shares held by the company are not cancelled. Treasury shares are recognized at cost and deducted from equity as part of the retained earning. No gain or loss is recognized in profit or loss on the purchase, sale, issue or cancellation of the Group's own equity instruments. Any difference between the carrying amount and the consideration, if reissued, is recognized in retained earnings. Treasury shares are used to distribute to employees, as per 30 June 2018 the company held 5,350 shares. Treasury shares held by the company are not cancelled. Treasury shares are recognized at cost and deducted from equity as part ofthe retained earning. No gain or loss is recognized in profit or loss on the purchase, sale, issue or cancellation ofthe Group's own equity instruments. Any difference between the carrying amount and the consideration, if reissued, is recognized in retained earnings. Treasury shares are used to distribute to employees, as per 30 June 2018 the company held 5,350 shares.

Currency translation reserve Currency translation reserve

The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations. This also includes the hedge results. The translation reserve comprises all foreign currency differences arising from the translation ofthe financial statements of foreign operations. This also includes the hedge results.

Revaluation reserve Revaluation reserve

The revaluation reserve comprises the fair value movements on all investments fair value through OCI of the Group. The revaluation reserve comprises the fair value movements on all investments fair value through OCI ofthe Group.

Interim dividends Interim dividends

It is proposed that an interim cash dividend of €1.35 per share will be paid out to shareholders for the financial year 2018, subject to 15% dividend withholding tax. It is proposed that an interim cash dividend of €1.35 per share will be paid out to shareholders for the financialyear 2018, subject to 15% dividend withholding tax.

13. Other contingent liabilities 13. Other contingentliabilities

Claims Claims

The Group is not involved in any significant legal procedures and/or claims and there are no other material contingent liabilities. The Group is not involved in any significant legal procedures and/or claims and there are no other material contingent liabilities.

Fiscal unity Fiscalunity

The Group constitutes a fiscal unity with its fully owned Dutch subsidiaries for Dutch corporate income tax purposes. Moreover, Flow Traders B.V. forms part of a fiscal unity for VAT purposes, covering part of the Dutch Group. All companies in the fiscal unity are jointly and severally liable for the tax obligations of the fiscal unity. The Group constitutes ^a fiscal unity with its fully owned Dutch subsidiaries for Dutch corporate income tax purposes. Moreover, Flow Traders B.V. forms part ofa fiscal unity for VAT purposes, covering part ofthe Dutch Group. All companies in the fiscal unity arejointly and severally liable for the tax obligations ofthe fiscal unity.

Cash incentive provided to employees Cash incentive provided to employees

As explained in the Management Board report of the Company's annual report of 2017, our employees have the possibility to participate in an employee equity plan and are eligible to a cash incentive depending on their share position in the company. One of the conditions for this cash incentive is that the employee needs to be employed at the company at time of the payment of the cash incentive. The 2017 plan have payments to the employees after the first, second, third, fourth and fifth year of the plan. The 2018 plan is adjusted, whereby the first payments will be done early 2019 and thereafter after the first, second, third and fourth year of the plan. For all subsequent payments after 2019 the employee needs to be employed at the company. Based on IAS 19, these costs are recognized in the year that the services are provided by the employee. As explained in the Management Board report ofthe Company's annual report of2017, our employees have the possibility to participate in an employee equity plan and are eligible to ^a cash incentive depending on their share position in the company. One ofthe conditions for this cash incentive is that the employee needs to be employed at the company at time ofthe payment ofthe cash incentive. The 2017 plan have payments to the employees after the first, second, third, fourth and fifth year ofthe plan. The 2018 plan is adjusted, whereby the first payments will be done early 2019 and thereafter after the first, second, third and fourth year of the plan. For all subsequent payments after 2019 the employee needs to be employed at the company. Based on IAS 19, these costs are recognized in the year that the services are provided by the employee.

The below presented table are the figures with the current off balance sheet liability. The below presented table are the figures with the current off balance sheet liability.

amounts FLOW CASH INCENTIVE PLAN INCENTIVE PLAN Payable amounts Payable FLOW CASH
		Year1(2018) Year2(2019)	Year3(2020) Year 1 (2018) Year 2 (2019) Year 3 (2020) Year 4 (2021) Year 5 (2022)	Year4(2021)	Year5(2022)
2017	300,000	600,000	600,000	600,000	600,000
2017	300,000	600,000	600,000	600,000	600,000
2018	-	2,248,000	2,248,000	2,248,000	2,248,000
2018	—	2,248,000	2,248,000	2,248,000	2,248,000
Total	300,000	2,848,000	2,848,000	2,848,000	2,848,000
Total	300,000	2,848,000	2,848,000	2,848,000	2,848,000

14. Group companies 14. Group companies

SUBSIDIARIES SUBSIDIARIES	Countryof Country of incorporation incorporation	interest Ownership Ownership interest
		2018 2018	2017 2017
Flow Traders Holding B.V. HoldingB.V. Flow Traders	Netherlands Netherlands	100% 100%	100% 100%
Flow Traders B.V. Flow Traders B.V.	Netherlands Netherlands	100% 100%	100% 100%
Flow Traders Technologies B.V. Technologies Flow Traders B.V.	Netherlands Netherlands	100% 100%	100% 100%
Flow Traders Asia Pte. Ltd. Flow Traders Asia Pte. Ltd.	Singapore Singapore	100% 100%	100% 100%
Flow Traders Hong Kong Ltd Flow Traders Hong Kong Ltd	Hong Kong Hong Kong	100% 100%	100% 100%
Flow Traders U.S. Holding LLC Flow Traders U.S. Holding LLC	United States United States	100% 100%	100% 100%
	ofAmerica of America
Flow Traders U.S. LLC Flow Traders US. LLC	United States United States	100% 100%	100% 100%
	ofAmerica of America
U.S. Institutional Flow Traders U.S. Institutional Trading Flow Traders Trading	United States United States	100% 100%	100% 100%
LLC LLC	ofAmerica of America
Flow Traders Technologies SRL Flow Traders TechnologiesSRL	Romania Romania	100% 100%	100% 100%

Significant restrictions Significant restrictions

The Group does not have significant restrictions on its ability to access or use its assets and settle its liabilities other than those resulting from the supervisory frameworks within which its subsidiaries operate. The Group does not have significant restrictions on its ability to access or use its assets and settle its liabilities other than those resulting from the supervisory frameworks within which its subsidiaries operate.

Related party transactions Related party transactions

No material related parties transactions have taken place in the first six months of the year. No material related parties transactions have taken place in the first six months ofthe year.

Subsequent events Subsequent events

Subsequent events have been evaluated through the time of issuing these financial statements on 26 July 2018. Subsequent events have been evaluated through the time of issuing these financial statements on 26July 2018.

No material subsequent events have occurred since 30 June 2018 that require recognition or disclosure in this condensed consolidated interim financial statements. No material subsequent events have occurred since 30 June 2018 that require recognition or disclosure in this condensed consolidated interim financial statements.

Review report Review report

To: the supervisory board, the management board and shareholders of Flow Traders N.V. To: the supervisory board, the management board and shareholders of Flow Traders N.V.

Introduction introduction

We have reviewed the accompanying condensed consolidated interim financial statements of Flow Traders N.V., Amsterdam, as set out on pages 11 to 23, that comprise the condensed consolidated statement of financial position as at 30 June 2018, the condensed consolidated statements of profit and loss and other comprehensive income, changes in equity and cash flows for the six-month period then ended, and the notes, comprising a summary of the significant accounting policies and other explanatory information. Management is responsible for the preparation and presentation of these condensed consolidated interim financial statements in accordance with IAS 34, "Interim Financial Reporting", as adopted by the European Union. Our responsibility is to express a conclusion on these condensed consolidated interim financial statements based on our review. We have reviewed the accompanying condensed consolidated interim financial statements of Flow Traders N.V., Amsterdam, as set out on pages ¹¹ to 23, that comprise the condensed consolidated statement offinancial position as at 30 June 2018, the condensed consolidated statements of profit and loss and other comprehensive income, changes in equity and cash flows for the six—month period then ended, and the notes, comprising ^a summary ofthe significant accounting policies and other explanatory information. Management is responsible forthe preparation and presentation ofthese condensed consolidated interim financial statements in accordance with IAS 34, "Interim Financial Reporting", as adopted by the European Union. Our responsibility is to express a conclusion on these condensed consolidated interim financial statements based on our review.

Scope Scope

We conducted our review in accordance with Dutch law, including Standard 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Dutch auditing standards and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. We conducted our review in accordance with Dutch law, including Standard 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Dutch auditing standards and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated interim financial statements as at and for the six-month period ended 30 June 2018 are not prepared, in all material respects, in accordance with IAS 34, "Interim Financial Reporting", as adopted by the European Union. Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated interim financial statements as at and for the six—month period ended 30 June 2018 are not prepared, in all material respects, in accordance with IAS 34, "Interim Financial Reporting", as adopted by the European Union.

The Hague, 26 July 2018 The Hague, 26July 2018

Ernst & Young Accountants LLP signed by T. de Kuijper Ernst & Young Accountants LLP signed by T. de Kuijper

This document contains "forward-looking statements" which relate to, without limitation, our plans, objectives, strategies, future operational performance, and anticipated developments in the industry in which we operate. These forward-looking statements are characterized by words such as "anticipate", "estimate", "believe", "intend", "plan", "predict", "may", "will", "would", "should", "continue", "expect" and similar expressions, but these expressions are not the exclusive means of identifying such statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause circumstances or our actual results, performance or achievements to be materially different from any future circumstances, results, performance or achievements expressed or implied by such statements. Such factors include, among other things, reduced levels of overall trading volume and lower margins; dependence upon prime brokers, ETP issuers, trading counterparties, CCPs and custodians; losing access to an important exchange or other trading venue; occurrence of a systemic market event; incurrence of trading losses; failures or disruption of our trading platform or our or third-party technical infrastructure; risks associated with operational elements of our business and trading generally; ineffective risk management systems, processes and strategies; intense competition in our business; dependence on continued access to sources of liquidity; capacity constraints of computer and communications systems; dependence on third-party software, infrastructure or availability of certain software systems; damage to our reputation and the reputation of our industry; loss of key staff or failure to attract and retain other highly skilled professionals; changes to applicable regulatory requirements; compliance with applicable laws and regulatory requirements, including those specific to our industry; enhanced media and regulatory attention and its impact upon public perception of us or of companies in our industry; and other risks. This document contains "forward—looking statements" which relate to, without limitation, our plans, objectives, strategies, future operational performance, and anticipated developments in the industry in which we operate. These forward—looking statements are characterized by words such as "anticipate", ^u u- "estimate", "believe ,Intend", "plan", "predict", "may", "will", "would", "should", "continue", "expect" and similar expressions, but these expressions are not the exclusive means of identifying such statements. Such forward—looking statements involve known and unknown risks, uncertainties and other important factors that could cause circumstances or our actual results, performance or achievements to be materially different from any future circumstances, results, performance or achievements expressed or implied by such statements. Such factors include, among other things, reduced levels of overall trading volume and lower margins; dependence upon prime brokers, ETP issuers, trading counterparties, CCPs and custodians; losing access to an important exchange or other trading venue; occurrence ofa systemic market event; incurrence oftrading losses; failures or disruption ofour trading platform or our or third—party technical infrastructure; risks associated with operational elements ofour business and trading generally; ineffective risk management systems, processes and strategies; intense competition in our business; dependence on continued access to sources of liquidity; capacity constraints of computer and communications systems; dependence on third—party software, infrastructure or availability of certain software systems; damage to our reputation and the reputation of our industry; loss of key staffor failure to attract and retain other highly skilled professionals; changes to applicable regulatory requirements; compliance with applicable laws and regulatory requirements, including those specific to our industry; enhanced media and regulatory attention and its impact upon public perception of us or of companies in our industry; and other risks.

The forward-looking statements contained in this document are based on assumptions, beliefs and expectations that we have made in light of our experience in the industry, as well as our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. Although we believe that the expectations reflected in such forwardlooking statements are reasonable at this time, we cannot assure you that such expectations will prove to be correct. Given the risks and uncertainties associated with forward-looking statements, you are cautioned not to place undue reliance on such forward-looking statements. The forward—looking statements contained in this document are based on assumptions, beliefs and expectations that we have made in light ofour experience in the industry, as well as our perceptions of historicaltrends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. Although we believe that the expectations reflected in such forward looking statements are reasonable at this time, we cannot assure you that such expectations will prove to be correct. Given the risks and uncertainties associated with forward—looking statements, you are cautioned not to place undue reliance on such forward—looking statements.

Such forward-looking statements speak only as of the date on which they are made. Accordingly, other than as required by applicable law or the rules of the stock exchange on which our securities are listed, we do not undertake any obligation to update or revise any of them, whether as a result of new information, future events or otherwise. Any forward-looking statements should not be regarded as a representation or warranty by us or any other person with respect to the achievement of the results set out in such statements or that the underlying assumptions used will in fact be the case. If any of these risks and uncertainties materialize, or if any of our underlying assumptions prove to be incorrect, our actual results of operations or financial condition could differ materially from that described herein as anticipated, believed, estimated or expected. Such forward—looking statements speak only as ofthe date on which they are made. Accordingly, other than as required by applicable law orthe rules ofthe stock exchange on which our securities are listed, we do not undertake any obligation to update or revise any ofthem, whether as ^a result of new information, future events or otherwise. Any forward—looking statements should not be regarded as ^a representation or warranty by us or any other person with respect to the achievement ofthe results set out in such statements or that the underlying assumptions used will in fact be the case. Ifany ofthese risks and uncertainties materialize, or ifany of our underlying assumptions prove to be incorrect, our actual results ofoperations or financial condition could differ materially from that described herein as anticipated, believed, estimated or expected.

Statements regarding the market, industry and trends, including ETP Assets under Management in certain markets, ETP Value Traded in certain markets and Flow Traders' competitive position are based on inside and outside data and sources. Statements regarding the market, industry and trends, including ETP Assets under Management in certain markets, ETP Value Traded in certain markets and Flow Traders' competitive position are based on inside and outside data and sources.

FLOW TRADERS

Flow Traders N.V. Jacob Bontiusplaats 9 1018 LL Amsterdam The Netherlands Tel: +31 20 799 6799 www.flowtraders.com Flow Traders N.V. Jacob Bontiusplaats 9 1018 LL Amsterdam The Netherlands Telz+3120 799 6799 www.flowtraders.com