The most important step in becoming a Forex Broker is the choice of technology and trading system. This is a defining moment because depending on the choice of technologies, the course of development of your entire business may change, especially if you are a novice Broker.
Today we will talk about how to choose the right trading platform for your business: where to start, what you need to pay attention to, and what options novice brokers have on the market. This article will also help Brokers operating for a long time and want to improve the quality of the services provided or reduce their operating costs.
1. Knowledge and resources
Before choosing your trading platform, you should honestly answer the question: Do you have enough knowledge and IT resources to deal with platform selection and technology installation? If the answer is no, we advise looking for a trusted technology provider. In the beginning, it may seem like a far from budget option, especially for start-up brokers, but all expenses will pay off in three months of doing business.
2. Industry experience and budget
Whether you can cope on your own or not depends on the level of your expertise in the forex market and the budget that you have. If you have already achieved success as an IB and know how the forex market works, it is worth looking for a solution to create your own brand. While your technology provider takes care of the optimal technology setup (including the Client Office CRM and the Back Office Apps), you can focus on attracting new customers.
3. Choosing target audience
An essential step in becoming a forex broker is identifying your potential clients.
If you are going to work with newbie traders:
- The trading platform should be simple and intuitive
- Be able to deposit and withdraw funds within the platform without switching to third-party applications
- Possibility to check the expected result of take-profit and stop-loss
- PAMM / MAM services or if it can be integrated with a Social Trading solution.
If you are going to work with experienced traders and IB, then the platform requirements will be:
- A mobile version of the platform is required since most transactions are made on the go.
- Synchronization of all user data and settings across all devices in real-time.
- automatic registration with KYC
- The possibility to create another account and transferring funds between the accounts
- Dedicated IB portal
- And even more… (For more information on what experienced traders need, take a look at our guide)
4. Ways of acquiring a trading platform:
There are three options, one of which we won’t consider today since this is creating your own platform from scratch. If you do not have experience in brokerage, you still do not know what the customers want, and you don’t have a reliable team – it is almost impossible to create a decent trading platform. Not to mention the fact that it’s a long and expensive process.
There are two options left, and the first one is the Full license platform. This is a solution for those who prioritize independence. You gain administrative authority to customize the entire trading environment according to your needs. There are several platforms available as a full license on the market: MetaTrader 5, cTrader, XOpenHub, Match-Trader, Utip, etc.
The price for such platforms varies from 15,000 to 100,000, depending on the popularity of the platform and its “filling”.
An option for start-up brokers to consider is the White Label Platform. This means that you can use somebody else’s platform without having to invest a lot of money for the Server License version. You choose a new name for the platform at your discretion, and you can use it under your brand. This is the cheapest option on the market and is available from $ 1,000. We offer a Match-Trader White Label solution with a low setup fee and with a possibility to pay a $ 0 monthly flat fee when acquired in the package with Liquidity.
The most popular solutions on the market right now are MT5 and MT4, but you can also look around the market to compare the key features and aspects of different platforms. Check our guide to see what key elements of a White Label trading platform you need to consider and compare.
In conclusion, we would like to say that, according to our experience, investors who want to become a forex broker and compete with the leading players in the market should still turn to a trusted, reliable provider of brokerage technologies. You will be able to grow your client base and not waste time on closing technical opportunities. In our guide, we’ve made a checklist of things to check when choosing a Forex Technology Provider.
Admin API
FIX API
Platform API
Brokers API