“MetaTrader 5 will be the platform of choice within 2 years” – Here is why

Today marks the day in which the MetaTrader 5 platform is set to become globally accepted, as FX integration technology company Gold-i has launched an all new version of its Matrix solution which allows brokers to aggregate incoming liquidity feeds and offer their own liquidity to customers.

In the advent of the launch of the new Matrix 2.0 solution, FinanceFeeds met with Gold-i CEO Tom Higgins in London, during which Mr. Higgins explained how the new integration technology that is currently being developed will allow MetaTrader 5 to be able to provide hedging, a feature which has held MetaTrader 4 in pole position in terms of market share over its newer stablemate since the launch of MetaTrader 5 in 2010.

Mr. Higgins explained that once hedging can be facilitated, MetaTrader 5’s modernity will be a boon to brokerages, especially insofar as that they will be able to offer their clients the full functionality that has maintained MetaTrader 4’s position as a ubiquitous and universally offered platform, yet give brokers an advantage in terms of being able to expand their operations without having to add more servers to their infrastructure as MetaTrader 5 operates in all global destinations from one server, whereas MetaTrader 4 requires servers in every location.

Today, the Matrix 2.0 solution has gone live, and FinanceFeeds spoke to Mr. Higgins in order to take a close look at this landmark launch.

 Matrix 2 is a very interesting development. One of the most critical aspects that will potentially transform the method by which brokers can house their infrastructure is the ability that Matrix 2 will provide for MetaTrader 5 to offer hedging. MetaTrader 5’s lack of uptake was largely due to its inability to provide hedging, hence the ubiquity of MetaTrader 4.

MetaTrader 5 will allow brokers to have one server and link multiple sites to it, rather than having to have separate servers in each regional office. Do you view this as a major infrastructural breakthrough?

The combination of MetaTrader 5 and Matrix 2.0 is a powerful offering for brokers. Matrix 2.0 will enable them to access multiple asset classes and liquidity pools in a streamlined way. It offers multiple routing and aggregation methods to allow brokers to offer the most effective execution model to different client types.

However, Matrix 2.0 has not been designed exclusively for MetaTrader – it has a bridge into MT4 and MT5 which is why we are initially focusing on the MetaTrader broker market. As Matrix 2.0 evolves, we hope it will be used by smaller banks and will open up broader opportunities for us outside the world of MetaTrader.

It’s a significant product for Gold-i and a unique product in the retail FX sector which is why we have invested in it so heavily. It has cost more than £1m to bring to market and has been in development for almost two years.

Will Gold-i be migrating brokerages from MetaTrader 4 to MetaTrader 5 as a service with Matrix 2 as well as the bridge and will other products such as MAM be broight across to MetaTrader 5?

We believe that towards the latter part of 2016 brokers will be ready to migrate to MT5. Gold-i has a range of products and services to help brokers to transition to MT5 and maximise operations as an MT5 brokerage. Matrix 2.0 is a compelling product for MT5 brokers as part of our offering.

Just as platform technology has become a vital subject for brokerages this year, so has liquidity management. With prime brokerage relationships having become more difficult to maintain and establish, and banks considering OTC derivatives to have a risk weight of 54% in some cases according to Citigroup, how will the new Matrix 2 system advance the cause of aggregated liquidity and provide brokers with better access to credit and unhindered order flow?

The fragmentation of liquidity and the explosion in the number of Liquidity Providers has resulted in a real need for an advanced multi-asset aggregation system. Matrix 2.0 allows the broker to access a combination of large Liquidity Providers and small Liquidity Providers together to make a single feed.

It is completely Liquidity Provider agnostic and leverages our existing connections with over 70 Liquidity Providers.

What is your favorite and most exciting feature of Gold-i’s Matrix 2.0 and how will it change the landscape of the de facto infrastructure and trading environment to advance it?

I am really proud of this product as I believe it will be a game changer in the industry. It’s been built from the ground up to be the fastest and most flexible tool on the market. The user interface has a really fresh look – so it’s a very appealing and easy to use product.

My favorite aspects of Matrix 2.0 are the ease of configuration and the flexibility on spreading all asset classes, giving brokers opportunities to make more money and reduce their risk.

Do you think that brokerages can reduce their costs via smart liquidity solutions that keep the cost of execution down on a cost per million basis?

The costs are more complicated than just looking at aggregation. However, if brokers use a combination of close where you open, aggregation, and primary/secondary they will receive the optimum cost of aggregation.

What do you think the retail FX trading environment will look like in 6 months’ time, with solutions such as Matrix 2.0 in existence as an antidote to the counterparty credit risk issues facing many firms?

I think there will be an increase in non-bank liquidity provision in FX and CFDs and we will start seeing a significant take up in MT5 in combination with Matrix 2.0.

Will MetaTrader 5 now go completely viral?

There will be a gradual build up but I believe MetaTrader 5 will become the platform of choice for retail brokers within 2 years.

Photograph copyright FinanceFeeds