Have you noticed the level of innovation in retail stock and options trading these days?
We’re trading from apps. We’re trading for free. We’re letting robots manage our portfolios. We’re getting trading ideas from algorithms.
So why aren’t we seeing the same degree of investor-friendly innovation in futures? Why has the futures industry refused to change its unwieldy, complicated and costly experience?
It’s almost like the futures brokers don’t want retail traders around, and it’s completely ridiculous.
Well, at Tradovate, we want individual traders to find a welcome home in the futures markets, and we’re working hard to create an experience every bit as enjoyable as trading stocks and options.
Here are the things we’re tackling to deliver that experience:
1. Costs
The exchanges charge a lot – clearing fees, data fees, per-contract fees – and we are pushing to create a better way forward for retail futures traders. We will save them money by investing in technology and by reexamining how traders pay for execution.
2. Trading Experience
People who trade stocks and options get everything they need from their online broker. They may go to other vendors for some extra education or trading ideas, but the broker provides everything (charting, etc.) required to trade successfully.
In the futures markets though, traders are forced to deal with a patchwork of clearing firms, brokers and trading platforms. This disjointed approach makes no sense. At Tradovate, we’re building a single platform where traders have everything they need, avoiding the messy collection of tools and services.
3. Technology
During the past 10 years, there was a trading-tool arms race that did little to make people better traders, but a lot to confuse and clutter the trading experience. So many new tools, but so little adoption. We think there’s a lot of room to simplify the trading experience for retail futures traders just by providing the tools people actually use.
4. Customer Service
Futures trading is not the same as stock trading, but it’s not outrageously different either. Traders, especially new ones, need a helping hand to navigate the ins and outs of the futures market. We’re building a team that will provide high-touch support when required.
5. Conflicts of Interest
Everything in the futures brokerage space is focused on making you trade more. That’s always been how brokers have made money. So the futures brokerage ecosystem of technology providers, educators, customer service and brokers are all aligned to push you to trade more – whether that makes sense for you or not.
And online stock brokers aren’t much better. Even the free ones have conflicts because they’re being paid to send your trades to specific exchanges. When we launch you’ll see how we’ve tackled the conflict of interest issue head on.
I hope we’ve hinted at enough new ideas that you’re eager to be part of our early 2015 launch (or at the very least that you want to stay up to speed as we move closer to launch).
Either way – be sure to sign up to be the first to know as we march ahead.
Rick
