South Africa is behind the curve when it comes to trading technology, as there is a lack of software development houses that focus on specific components of trading technology in SA.
So says James Saulez, CTO of Global Trader, adding that existing development houses seem to be able to survive only if they focus on all areas (front office, back office, integration). “They tend to be jack of all trades, master of none.”
Saulez points out that abroad, trading technology vendors concentrate on specialisation, be it pricing distribution, charting, risk management systems, front ends and so forth. “This is not the case locally, and thus the foreign software is much better.”
Saulez says the JSE is behind on modernisation of its systems, and is not nearly as focused on broker enablement and consumerism as other first world exchanges. “There is much confusion around delivery timeframes of the improved market connectivity and infrastructure framework. This leaves technology-focused brokers and software houses in the dark as to what strategic decisions to make,” he adds.
“A large portion of IT spend by the technical community reliant on the JSE is spent on work around ageing interfaces and points of integration, in order to enable their own value-adds and offerings.” He says this effectively constrains innovation and hampers competitiveness.
Greater variety
retail level by many brokers.” He says the more retail-oriented, user-friendly trading platforms, for both exchange traded and derivate products like CFDs, in the South African market, the better.
In countries like the US and UK, says Saulez, the environment is of such a competitive nature that the consumer ultimately benefits from low costs of trading, driven by true competition.
“They also benefit from a plethora of platforms to suit their level of trading acumen and experience, as well as self-directed online brokers providing ever-improving educational and supportive content and tools to an untapped market.”
He says this level of competition and variety does not exist in SA. “Without the forces of competition and organisations and individuals challenging the status quo of the self-investment culture, it does not seem likely that the retail market will grow.”
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