Expert Opinion: Building a Successful Brokerage Business in Tomorrow’s Landscape

Our CEO, Andreas Kapsos, was invited to speak on the panel  “Building a successful Brokerage business in tomorrow’s landscape” during the iFX Expo International. He had some interesting insights, so we asked him to elaborate and tell us more about the matter.

Andreas Kapsos, CEO od Match-Prime Liquidity, speaking about building a successful brokerage business

The current rate of advancements in technology makes user demands higher than ever before. That’s why, nowadays, to create and run a successful Brokerage business, Brokers need to acquire modern technology that will meet the needs of both traders and Brokers themselves. What does that mean?

From an LP point of view, we know that anything can be critical. Even the slightest improvement can bring huge benefits. That’s true in software and hardware – we host our servers close to our liquidity sources to minimise execution latency. Also, it’s good to remember about liquidity when starting a Brokerage business. Building a business based on the most open model leads to smart order routing. The role of technology has been steadily increasing over the past years. As we know, it’s the technology that enables us to provide clients with deep liquidity and low latency execution.

During the discussion, you said that “the most important feature of technology is how fast it is changing”. What exactly did you mean?

A couple of years ago, execution algorithms were just mechanically slicing a large order into smaller ones. Now, they respond to real-time changes in market conditions. 

Today, we can use AI algorithms that enhance liquidity management and execution of large orders with minimum market impact. New solutions emerge every day, and that can be an opportunity for a Brokerage business because it is easy to gain an advantage, but it can also be a threat. The worst that a Broker can do is to rest on their laurels and stop developing.

So, in your opinion, what is the way to go for a Brokerage business that wants to develop?

Looking more broadly, referring to the panel topic, it is best to have the broadest possible control over your Brokerage business. Big things are important, for example, managing the platform setup with your server, but small things like creating custom shortcuts based on user experience are important too. Brokers should choose technology that does not hinder the use of tools produced by other companies. For example, a bridge should include an API to enable cooperation with various products. There’s nothing wrong with taking multiple tools from one vendor, but you do need to have a backup plan. This applies to liquidity but also many other areas.

Going back to technology and the fast-changing environment we operate in, what is the most crucial aspect for a Brokerage business?

A key concept to understanding the meaning of technology is it being customisable. The times when recipients adapted to the available solutions are over. Now, it is the technology that has to adapt to the needs. This applies to both B2B and B2C markets. We respond quickly to our clients’ reports, allowing them to implement the changes that traders expect quickly. Match-Prime uses in-house technology developed by our strategic partner Match-Trade Technologies so that we can introduce a wide range of changes. All in all, technology is important because it allows responding to human needs.If you want to discuss this further, you can chat with our experts at the upcoming iFX Expo Asia in Bangkok on September 13-15. Also, we encourage you to vote for us in the Fazzaco Business Awards 2022. We are nominated as the Best Liquidity Provider.

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