The financial industry is moving fast, and last year was no different. In an environment where changes happen all the time, brokers’ and traders’ preferences are also evolving rapidly. Today, Albina Zhdanova, the COO of Tools for Brokers, is sharing some of her insights and forecasts on the future of the industry:
1. Even more retail traders joining the market
If there is one positive outcome of the pandemic, it is that more households than ever have joined the world of investing and trading. Among the new market players are many beginners, who will require additional assistance in the form of advisory or extra services. This means higher turnovers and, hopefully, more revenue for brokers and increased wealth for traders.
We believe that there will be a growing demand for money management solutions, where Investors can copy the trading strategies of experienced Investors and entrust their money to them. There is also an increasing demand for content in the form of blog posts, videos, and social media presence. Traders want to learn more, and they will trust those brokers who share their knowledge with them.
2. Growing demand for 24/7 trading
One of the results of retail traders joining the trading world is a higher demand for 24/7 trading. Trading over the weekend already exists to some extent, but with thousands of people working regular 9 to 5 jobs and only having free time over the weekend, the next few years will bring a genuine change in the system. At TFB, we have already started implementing this new trend by integrating with Weekend FX by LMAX and enabling trading of selected currency pairs on Saturdays and Sundays.
3. New regulation rules
Stricter regulations have been introduced gradually over the years, and they will continue to develop in the future. Although more reports and laws are sometimes seen as an unwelcome burden, we think that overall it is a good thing for the industry. With a clear structure and rules in place, everyone knows what is expected of them, and everyone feels protected. By the way, we have a complete solution for both internal and external reporting as a part of our solutions ecosystem, so all our clients can easily comply with regulators.
4. High volatility as the new normal
Periods of high volatility are simultaneously exciting and terrifying. It is easy to make money and easy to lose money. While the market is notorious for being volatile and reacting strongly to a variety of events, we can all agree that last year has shown us what actual volatility is. Hopefully, with more and more people being vaccinated, the worst — which is a threat to our health — is already behind us. However, excessive volatility will likely be happening throughout the year 2021 due to governments’ plans to support the economy and the consequences of these measures. And we are not saying this to scare anybody. There’s always something happening in the industry. Last year it was the unforeseen global pandemic; next will be a new kind of bubble or possibly legislation that will turn everything upside down. Although we cannot stop that, it is possible to prepare for it, and we have even created a checklist of what brokers can do to protect themselves.
Whatever the future holds, brokers can prepare for it by partnering with the right solutions provider. Tools for Brokers offers an ecosystem of solutions centred around the flagship product — Trade Processor liquidity bridge, supported by data management and reporting, money management, and individual custom solutions.
Albina Zhdanova is the COO of Tools for Brokers. She is responsible for the company’s operations management and expansion overseas, helping TFB launch three new offices in China, Cyprus, and United Kingdom.