Banks receive no-coding algo-trading tool from BestEx Research
Banks can create their own algos without being required to write any code using an electronic tool provided by BestEx Research Group LLC, which runs an algorithm-driven trading platform.
According to Hitesh Mittal, the founder and CEO of BestEx, the new tool from the technology company, called Strategy Studio, enables brokers and buy-side clients to create algos, reducing costs and time. Each algorithm can be linked to a bank or broker-trading dealer’s goals.
Mittal also predicted that banks would become buyers rather than traders over the next ten years. This article covers how a technology company is now introducing an algo trading tool that can make the life of American bankers easier by letting them do their job instead of building their own trading algorithms.
New horizons for American banks
According to researcher Chartis, as Wall Street trades more and more asset classes algorithmically, including fixed income, foreign exchange, and options, commissions for algo trading are anticipated to rise to $34 billion in 2019.
The electronic trading departments at banks that serve customers in the stocks, futures, and fixed-income markets are the target market for BestEx’s new product, which is situated in Stamford, Connecticut. Five financial institutions, including Bank of Nova Scotia, are presently utilizing the latest software. According to Mittal, two more prestigious banks have signed up for futures trading. At least 10 banks must agree to construct their bespoke products on top of BestEx’s current algo-management system over the course of the next two years.
To provide clients with quick, effective technology, banks have set aside hundreds of millions of dollars to construct trading platforms. In the second quarter, Wall Street behemoths Goldman Sachs Group Inc., Morgan Stanley, and others brought in $29 billion in trading income, a 21% gain over analysts’ expectations, with JPMorgan Chase & Co. leading the pack.
A simpler and a cheaper way to trade
BestEx said that its algo-trading software (in other words, algo trading without coding) product is available for less money than it would cost banks to develop such products on their own. Depending on the size and complexity of the bank, the firm’s subscription will run about $1 million every year, Mittal added.
He asserted that the next wave of algorithmic trading would originate from independent enterprises with greater freedom since, despite banks’ financial resources, innovation at larger corporations is difficult.
BestEx, a company established in 2017, created a cloud-based trading platform for stocks, futures, and currency. Last year, it introduced a futures algorithm that uses a model that takes volatility, volume, spreads, and other exchange-specific data into account to reduce transaction costs.