TraderEvolution at iFX EXPO Asia: Roman Nalivayko on brokers going multi-asset in Asia

This year’s iFX EXPO Asia took place at the Centara Grand & Bangkok Convention Centre at CentralWorld, Bangkok, Thailand.

From 20 to 22 June, the arena hosted 3,000 attendees, exhibitors, and sponsors which included successful start-ups, leading international brands, and industry giants.

TraderEvolution turns FX brokers into multi-asset powerhouses

Among the leading FX brands present at iFX EXPO Asia 2023 was TraderEvolution Global, the renowned multi-market trading software provider offering connectivity to dozens of markets across the globe and a liquidity-neutral solution that facilitates core brokerage operations.

The trading platform  provider has been experiencing significant growth as the industry increasingly goes multi-asset, with brokers offering both exchange-traded products and over-the-counter trading. Navigating through such complexity is a challenge that only a few software developers are able to address. Hence TraderEvolution’s success in today’s brokerage space, and just recently the company announced deploying a new multi-asset solution for Tradoverse.

TraderEvolution brings multi-market capabilities to Asia

To learn more about TraderEvolution’s approach to Asia’s brokerage industry, FinanceFeeds Editor-in-Chief Nikolai Isayev spoke with TraderEvolution Co-Founder and CEO Roman Nalivayko. Below, the transcript of both questions and answers.

Is it safe to say that in every region in the world, there’s a different trading culture and investor profile? Does that require a different approach to brokerage solutions? In other words, what do brokers in Asia need today?

Yes, each region in the world has its own character. Brokers in Asia tend to provide feature-rich interfaces to their clients, especially for mobile apps.  This means that the front-end side of the brokerage platforms is more important and challenging in Asia than in other regions, where simple trading apps may suffice or be expected.

In other aspects Asian brokers are not very much different from other brokers in need of a flexible technology that would allow them to react quickly to new trends and opportunities.

This is where things only get more complicated as we are observing the rise of AI-driven tools which most likely will have significant impact on front-ends used today. We still have to see what impact this technology will have on the market but atleast current platforms should be flexible enough and allow quickly integrate new tools.

There is an ongoing trend that sees brokers increasingly migrating to their own front ends (they develop proprietary web or mobile apps in-house or in partnership with a software firm) or even whole in-house solutions with a proprietary back end. For whom it’s a viable option? Do you see that becoming the norm, even in Asia?

In the first place, an in-house trading platform is perhaps the only solution for brokerage companies that would like to go public with their shares.

We must emphasise that software, especially on the front-end side, is a critical component of a brokerage service. To ensure a proper level of service and to stand out on the market, brokers must invest in software.

But what about many brokers who don’t want to be software companies? They excel at being brokers and with their service quality they could beat the top firms if only tech was a level playing field for them.

Yes, not all companies can afford full in-house solutions, especially with the amount of time required for development.

I’d say that for the majority of companies, it’s more practical to use a powerful back-end system from a vendor and integrate an in-house front end with it or build something on top of the source code. When developing a proprietary front-end terminal broker may for example use a 3rd party chart library like Tradingview which is very popular among traders and would speed up the development process.

In TraderEvolution we actually have diverse clients, clients with various needs, and we are trying to help them find the most optimal solution for each individual situation. We aggregate experience from multiple projects and most useful concepts become reflected in our solutions, which is something extremely difficult for brokers to recreate with their own in-house development.

In general, there are lower barriers to entry for brokers in Asia, especially because of less regulatory pressure. This means that more and more brokers may look to onboard and retain new and existing traders in the region. How can brokers ensure their competitive advantage?

Lower barriers for entry mean more competition which makes competitive advantage crucial. To ensure it in Asia, brokers should offer sophisticated mobile apps on par with local players, most of whom develop their apps in-house. Ultimately, the competition here would revolve around making the user’s life better.

For example, given the common use of numbers in instrument tickets in many Asian exchanges, the user interface should be adapted to this. For example, company logos and market exploration tools can make the interface more user-friendly and intuitive. At TraderEvolution, we extensively use logos as part of the interface, with our own database covering more than 23 stock exchanges. Another important field for competition could be communication with clients – assisting, guiding and educating them. That’s something a proper trading platform can and should accommodate. With vast product offerings brokers are running today every such aspect really matters.

A recent survey by Capital.com found that traders are more profitable when diversifying their investments between asset classes, ‘the more the merrier’. Given that it’s good business for brokers to keep users from blowing their accounts, what steps can brokers take to go multi-asset?

A diversified investment portfolio is a common need for traders, so they tend to choose a brokerage company that offers a comprehensive coverage of markets and asset classes. Before making the move to become multi-asset, brokers need to gain the appropriate expertise. Adding exchange-traded products to the current platform may not work if the broker’s background is primarily in FX.

Once the expertise is in place, it’s essential to establish relationships because data and execution are critical elements of the puzzle which technology facilitates.

Speaking of technology, brokers going multi-asset must evaluate whether the current technology can support this development or if a proven multi-asset software solution is needed. When considering a multi-asset technology, it’s important to choose one that isn’t locked onto a particular prime broker or liquidity provider, and ideally allows for scaling and growing in multiple directions. In the long term, the ability to work with any counterparty plays a critical role in keeping the offer competitive and flexible enough.

There are also some other aspects to take into account and we have them covered at TraderEvolution as the platform is constantly being developed in terms of multi-market and multi-asset capabilities. For example, we’ve talked about the front end a lot, but in a multi-asset environment most of the magic happens in the back end, and certain processes require lots of automation.

In regard to equities, US stocks remain the holy grail for global investors, but the time zones in Asia have always made it difficult for traders to properly trade the US markets. Should Asian brokers offer US stocks anyway?

US stocks indeed remain a crucial part of most multi-asset brokers’ offerings, despite the time zone challenges for traders in Asia.. While time zones do add certain inconveniences for Asian traders trading the US market, there are ways to improve the service. Our platform, TraderEvolution, is known for efficiently combining domestic and international markets. For instance, it supports off market orders, allowing traders to create orders out of regular market hours to operate whenever it’s  convenient for them. I would say that there are things that could be done to make things easier and proper software can help a lot.