The new era of trading platforms

Author: Albina Zhdanova

If we were to describe the trading industry in two words, we’d call it progressive and conservative. Somehow, the two aspects manage to co-exist happily, despite how contradictory they seem.

One such paradox is the conventional setup where brokers would work solely with one trading platform and rarely explore the alternatives. This is understandable, as the longer you work with a certain platform, the better you’re able to manage it. All the ins and outs are familiar, and the existing community, with its valuable knowledge and helpful add-on tools, is there to support you through anything.

It’s been like this for decades.

Lately, however, we’ve seen quite a radical shift to a multiplatform setup, where a single brokerage is working with two, and sometimes three trading platforms. There is also a considerable number of brokerages who are willing to bet on lesser-known trading platforms that have been popping up in abundance over the past few years, ignoring the default market leaders.

So what is causing this fascinating change to the seemingly set-in-stone process? Let’s talk about it!

What is causing this shift in the trading platform world?

• The retail Forex market as we know it is still young, and still in its active growth phase. Even though many claim that it has passed its peak, history tells a different story. As the market matures, it is naturally expanding, and every niche is becoming saturated with vendors who are attracted by the growth and steady market opportunities.
• Regulation and compliance authorities are cropping up in more and more countries, new trends are emerging, and global institutions are starting to catch up. The rules they impose affect how the market performs, and new trading platforms are able to meet these new demands and help brokerages make the most of the changing environment.
• Traders are more knowledgeable and better educated, demanding newer, more user-friendly and feature-rich solutions. It’s easier for new startups to cater to these needs than for a legacy platform to completely redo its logic, interface, and code.

Is the recent trading platform boom good or bad?

The way the market is changing, the quality of traders and products has improved significantly, so providers are pushed to change how they do things. Innovation is always disruptive and can feel uncomfortable at the moment, but it always results in new solutions that would be unthinkable if we stuck to the status quo.

High-quality services also can be more costly because brokers need to comply with regulatory requirements which some might see as a bad thing. In TFB’s opinion, a slight cost increase is a small price to pay for the security and peace of mind that you get in return for a safe market environment. 

At the same time, with more trading platforms competing for brokers’ attention, the invisible hand of the free market will make sure we end up with more top-notch solutions at an affordable price.

So, to sum up, having more trading platforms on the market is ultimately a good thing. Two heads are better than one, and the more companies that join the trading world, the better the outcome will be for everyone. 

What to expect from the trading platform market in the years to come

• More market players will join as the industry grows more lucrative and earning potential increases.
• Some will not meet the expectations and fall off eventually, but others will continue to thrive.
• Many brokers will hold on to their legacy trading platforms but once the critical mass of brokerages move on, the rest will follow.
• Multiple trading platforms per company will eventually become the norm.
• Several platforms will provide more services and will be more risk resistant, which can’t be underestimated in our vulnerable times.

Final thoughts on the shift towards the multiplatform trading world 

The way all events are playing out right in front of our eyes is fascinating. MetaQuotes, the decades-long market leader for trading platforms is currently going through a structural change designed to align perfectly with new regulations and guarantee exceptional quality of services. Doing that, by default, is not without collateral damage, however, their vision, if followed through, is going to create a new standard for professional traders of the future who will also be dealing with other instruments besides Forex trading.

At the same time, we notice the rise of other trading platforms, which seize the opportunity to attract new clients and expand their target audiences while the market is going through a bit of turmoil. The complex challenge those new platforms are facing is marketing. Digital advertising is pretty much impossible, thanks to Google’s ruthless policy. Putting yourself out there on banners is also of little value, so many turn to professional events and expos which often require a substantial budget.

The lack of traditional marketing campaigns seems to be replaced with word of mouth thanks to the focus on the user experience by newcomers. If we talk about cTrader, for example, they are well-known for being easy to use. It won’t guarantee that established traders will make the switch, but we have a huge growth of new traders joining Forex around the world, so there’s no shortage of new leads. As for Match-Trader, the company designed an impressive partnership program that also serves as a great advertisement.

Brokerages, hedge funds, and prop trading firms that will be reviewing their trading platform options need to keep in mind that traders represent a complex and multifaceted community which needs to be nurtured and supported to be successful. The best tip we can give right now is to keep up with the industry trends and news, watch out for upcoming stars and implement them into your processes in a way that makes sense for your business. 

At TFB, we believe that every trading platform will find its users, and they will be able to co-exist with various trader groups using different solutions that fit their needs. There will be crossover as well, so it makes sense to stay open-minded and look into new platforms as they pop up and gain traction. And if you’re ready to give new trading platforms a go now – all the better! Research your options, test them out, offer them to clients, listen to their feedback, implement it, and thrive.