Is your STOCK BROKER , really ALGO enabled ?

Today Traders have clearly demarcated stock brokers in 2 categories

1.     Algo Enabled brokers

2.     Non Algo enabled stock brokers

Around 77% intraday traders consider Algo trading facilities as the reason to shift from their existing to new stock brokers. Algo trading has gathered momentum specially after peak margin rules, clearly pushing out the non strategy based traders out of market.

Checklist of a good ALGO ECOSYSTEM for Stock brokers

For making an Algo product/ ecosystem successful, 3 of its essential components should be in proper place

1.     IT/API/ connectivity : It is very critical that your IT infra or API connectivity of the Trading architecture and Algo platform is in place providing a plug-n-play model for any algo platform to onboard easily

2.     Algo Platform tie ups: In last few years there is a huge breed of ready to use algo product/ startup has emerged which makes the whole algo experience for even the most novice trader very easy and seamless, A broker must ensure that he has all good algo platforms empanelled and onboarded so its clients have a wide variety of options when it comes to choosing an algo platform

3.     Visible, Vocal, Viral approach : Most of algo enabled stock brokers neglect even communicating with employees that they posses algo services, neglecting the power of these products, specially in a world where all brokers have same margin, brokerage structure, these are disruptive products and key revenue enhancer

Checklist for a trader to evaluate algo services of a broker

1. Dedicated Algo Desk: How serious is your broker towards algo ecosystem, do they have a dedicated Algo desk, which knows and understand all about algo trading systems, and trouble shooting

2. All order type supported: Does the algo system support bracket, cover, multiple leg orders for algo

3. API and EXE based algo system: Does your broker provide support for REST and Universal API and EXE based algo platforms with multi session logins

4. Commitment/ Seriousness: Is your broker really serious on the Algo side, is the broker committed to provide proper support and ecosystem for a Algo traders is the most important thing to evaluate

Today 65% of trades in india are done via algo, According to estimates currently 5 Lakh active traders use Algo trading in india. 1 year back the active algo traders were merely touching 1 lakh, Studies say that by the current year end 80% of intraday traders will shift to Algo trading making the active algo traders to 20 lakh by year end, the pace will multiply specially post September PEAK MARGIN blow out

In a nutshell, Algo Trading is the next biggest disruption in Indian stock markets, 10X more disruptive then discount broking system, while PEAK margin rules in place, traders with proper trading system and plan will survive

Feel free to touchbase for any consultation

Ashish Andani

Ph: 98938-94415

PS: Views are in personal capacity 

Other articles:

https://www.dhirubhai.net/pulse/stock-broking-industry-disruption-mode-ashish-andani/

https://www.dhirubhai.net/pulse/algo-vaccine-broking-industry-ashish-andani-1e/