When it comes to mobile trading
or the world of 'on-the-go’ execution,
it’s all about apps. The explosion of apps on the
market enabled by the advent of smart phones has taken even the
keenest industry analyst by surprise. On Apple’s
iTunes, consumers can download iPhones apps for trading almost
any asset class including foreign exchange (FX), futures and
options as well as spread betting products.
This stellar opportunity in
mobile trading is reflected in the growth of apps as a whole. A
forecast issued last December from market research firm IDC
revealed that the number of downloaded apps is expected to
increase to 76.9bn worldwide by 2014 (2010: 10.9bn), with
mobile apps to grow at a CAGR of 60% through 2014 and mobile
app revenues surpassing a massive $35bn by that point.
Although the evolution of mobile
trading and associated apps is still in its infancy, recent
growth has been exponential and it seems that almost everyone
in the industry is getting involved. Howard Boville, managing
director for Trading Systems & Financial Systems at BT,
says: "It’s really right across the board in
respect of the whole trade cycle. The scope is retail,
sell-side/buy-side institutions and liquidity venues.
It’s just about anybody using mobile trading to
communicate with folks.
"Mobile trading allows people to
be agile in where and when they work," he adds. "So, if it
provides benefit in terms of trading, market participants will
be using the available technology tools. And it will only grow
as traders have the opportunity to communicate to greater
numbers of people by using the technology."
Indeed, with such mobile
devices, a trader could be watching a video on one screen,
talking on a headset to a customer whilst IM’ing
one of their research analysts. They could also be receiving
text and viewing information off social media such as
Recent developments and new
product launches in the mobile trading space have come through
thick and fast. In June 2010, DAS Trader, which its maker
claimed was the fastest trading software for the US
stockmarket, released new remote trading apps for
Apple’s iPhone and iPad.
DAS, whose app offers equities,
options, futures and forex in a combined platform, touted
direct access order routing and superfast execution on the way
to work or at home. While iDASTrader interfaces are
specifically designed for the retail investor,
DAS’s infrastructure is designed to be relevant to
the most sophisticated institutions as well.
Even the large investment banks
are getting in on the act. Take JPMorgan, which in March 2010
ported a version of its MorganDirect platform to the gadget,
allowing armchair traders access to forward, swap and option
transactions for around 300 currency pairs.
Portable trade management
Last November, FFastFill, the UK
AIM-listed provider of application services to the global
derivatives community, enabled its applications for use on the
iPad. As a result, the full suite of FFastFill’s
exchange connectivity and functionality from front to back
office was made available as an iPad application (a pipeline to
over 50 exchanges and platforms), offering institutional
clients an additional flexible trading and monitoring tool.
BT, which provides hardware for
voice traders across the asset class spectrum, has developed
software-based applications that complement that hard turret
that resides on a trader’s desk. I-Trader, a BT
collaboration suite, effectively brings together the various
communities that a trader may have (e.g. directories on
Linked-in, Outlook, Yahoo) and encompasses video conferencing,
mobile, email and instant messaging.
explains: "I-Trader brings that all together in an integrated
fashion and allows traders to interact/transact in the most
optimal way, based on all the information that may be thrown at
Henrik Dyrholm Holst, head of
platform management, Saxo Bank, believes that mobile trading
and associated app devices are very much here to stay. He says:
"As mobile devices have become more and more advanced, the
trading experience that can be delivered to clients is no
longer just a case of basic market access when a desktop PC is
Dyrholm Holst says clients are
increasingly expecting more advanced features when they trade
on a mobile device, ranging from technical analyses to
incorporation of market research, portfolio management and
news. "Mobile trading caters very well to individuals who need
to have constant access to the markets and their portfolios,"
"That said, we’re
still in the early stages of what we call smartphone mobile
trading," he says. "Browser-based mobile solutions that have
been around for quite a few years offering basic access to
markets and those companies that made mobile trading a priority
early on, have enjoyed a first mover advantage, which has been
evident in the demand from clients and the increase of trades
placed through mobile devices."
In coming years, the Saxo Bank
executive believes we will see two approaches to offering
mobile trading, namely: native trading app solutions and a
web-app approach. "With the explosive growth of native apps
being distributed through app stores, many companies are
developing native trading solutions for individual mobile
platforms and distributing them through the various app
stores," he says.
"Others choose to adopt a
web-app approach," he adds. "Utilising the increased open
sourced standardisation of mobile browser capabilities such as
WebKit and HTML5, which offers a viable alternative to native
development and at the same time targets a large number of
Challenging the desktop?
In terms of how mobile trading
is viewed in the markeplace, Dyrholm Holst says: "At present,
mobile trading is not viewed as a viable alternative to a
desktop setup and it may never be. But with the introduction of
tablets and the increased 'screen real-estate’ of
the tablet form, companies are faced with a unique challenge of
creating a platform that lends itself to the touch-based
interface of these devices."
He also contends that an
"interesting challenge" in this space, is "providing a mobile
trading platform that caters to both the frequent trader and
the portfolio manager".
In terms of actually trading on
such mobile devices, BT’s Boville acknowledges
that presently they are "not witnessing widespread adoption of
tablets on the trading floor." That said, BT’s
trading systems business has had a touch-screen tablet-like
turret in the market since 1995.
Boville points out: "There are
some banks utilising that capability as a preference to using
touch screen as opposed to the button. And, whilst there is
currently not a widespread adoption in terms of using tablets,
we envisage an uptick and it becoming more prevalent."
He adds: "We’re
starting to develop beyond the i-Trader piece, looking at the
whole concept of tablets and how one integrates them into the
trading environment. So, you’re no longer just
thinking about mobile trading in terms of a mobile device,
which is used for voice communications - you’re
using the full multi-media capability of that mobile
However, there are interesting
problems posed by the tablet. One centres on how to ensure that
that tablet is secure in the domain it operates within. Boville
says: "How does one ensure that the person using that tablet is
actually used by the person that they say they are, and when
they’re executing transactions within a firm are
they initiating these on behalf of X or Y bank?".
A trader may want to come into
work and use their own personal i-Pad. "So, partly they have it
for their own personal use, but when they’re in
the trading environment it can be 'locked down’ to
do the trading," adds Boville.
As to longer-term implications,
Dyrholm Holst argues: "We’re currently in a
transition period where companies are looking at different ways
of delivering an optimised trading solution for mobile devices,
either by adapting current trading platforms or by developing a
unique trading solution for each form factor."
One limitation that will remain
with mobile trading is the perceived lag, however small, of any
wireless device and how it impacts the flow of data and trade
execution. There is also the limitation of the physical size of
mobile screens, although the new larger sized Blackberry Torch
device is a step in the right direction.
Embracing the tablet
In the short term Dyrholm Holst
envisages that we will see companies working to establish a
"solid presence in the smartphone space by having either native
applications or web-based solutions that ensure an optimal
trading experience on a mobile, then moving on to the tablet
and the unique opportunities and challenges that this form
Differentiation in offerings
will be driven by client type, providing unique solutions
catering to both the active trader and the long-term investor,
Beneficially to mobile device
end users, voice minutes are on a downward trend. And, with
Intel producing nfactor chips that require less battery power,
mobile devices will benefit from greater processing capability
and be more and more like a computer.
Boville says: "From the
application perspective an interesting question is: 'Who will
purchase the applications?’. Will it be the firms
that buy these mobile apps for the traders, or will the traders
buy their own apps because they want particular tools?"
Matt Woodhams, head of
e-commerce (EMEA) at GFI Group, a provider of wholesale
brokerage and electronic execution services, says: "We tend to
find these [mobile applications] work pretty well in a global
business...where people may not be in the office but maybe want
to see European or US markets."
For this wholesale intermediary
adding a "mobile view" is all about adding to client choice in
the way they wish to transact - either electronically or via
the phone. Just as choice exists using one of
GFI’s GUIs or an API to trade programmatically.
GFI’s clients really depend market to market, and
in the fixed-income market they include sell-side institutions
like Morgan Stanley, Goldman Sachs and JPMorgan.
Woodhams who heads up e-commerce
strategy for GFI’s in Europe adds: "For the
wholesale space they [applications] are a quite a nice add-on
in a 24-7 world to access real-time information. However, in
terms of physically transacting across them, I have doubts that
the wholesale markets would ever be on the mobile channel."
"It is one thing to trade 100
Vodafone or BP shares whilst you’re sitting in a
café or your armchair, but quite another to trade a clip
of say $100m worth in i-Traxx products," Woodhams says.
"The regulatory controls around
wholesale markets need to be and are correctly more stringent
than they would be for say spread betting purposes." That
confines the value of the mobile device as a transaction tool
in the wholesale space.
He adds: "By contrast I can see
the application of mobile devices for spread betting or buying
stock on a personal account backed up by a credit card or a
bank account. That’s not systemically so
Given that GFI’s
hybrid broker business model is wholesale in nature, the firm
does not offer execution across the mobile medium, with the
data provided by GFI being proprietary to the broker
"What we do offer in terms of
data is rather more indicative in nature and complementary to
the ultimate trading decision," says Woodhams. "Fundamentally
for us it’s all about getting data in front of
people, which is less constrained by technological advancements
than say interactive trading on a mobile phone would be."
With traders at many large
institutions tending to specialise in particular asset classes,
critically they want to see more of a "breadth rather than
depth" of data and prices related to their specific markets,
the GFI executive says.
In the credit space, GFI trades
index products such i-Traxx, where through a limit order book
users can view the best Bid/Offer prices, second best
Bid/Offer, etc. Woodhams explains: "On CreditMatch,
GFI’s central limit order book, if
you’re sitting in your office you could click on
the prices and actively trade. This would be a similar to if
one were looking an exchange screen where you wanted to buy
shares in FTSE 100 stocks."
product to its CreditMatch is CreditMatch Webview. This enables
a user on Blackberry or iPhone devices to log in to view market
prices. Woodhams points out: "While on the web version one
cannot trade, clients do get to see the markets real time. And,
at that point we provide a telephone number that can be clicked
on to call GFI, if required."
As to the future and where the
market will be in three to five years time, BT’s
Boville contends it’s perhaps a little "too hard
to call". He says: "The technologies one thinks will be adopted
are never adopted quite as fast or as fully as envisaged.
Typically the IT cycle is around 10 years, but on top of this
there are many developments that occur along the way that cause
surprise. But we’ll probably be in a completely
different place and phase to where we currently think