The overcrowded world of trading platforms in the retail FX space has long been governed by a single terminal that has firmly positioned itself as the ‘be-all and end-all’ of the sector. However, beyond the immediate vicinity of popular discussions, a long-standing competitor operates offering users a sound, complete and interesting trading solution.
We sit down with Akram Majed, CEO & Founder of Hybrid Solutions, the technology outfit behind the established, yet unfamiliar, VertexFX trading platform.
The migration from open-outcry (floor trading) trading methods in the 1980’s to electronic trading has revolutionized the global financial markets landscape. It has evolved from being a niche product and opened its doors to the masses, as new participants have entered the market through the accessibility and connectivity of trading platforms and the mighty, World Wide Web.
Akram Majed, an egineering (computer science) graduate from the University of Jordan, had a compelling interest in the world of financial trading. Coupled with his technical standpoint, he combined both forces in 2002 when he formed Hybrid Solutions, a software and technology firm, to plant the seeds for his own electronic trading platform for global financial instruments, VertexFX. The platform went live in 2005 and Hybrid Solutions bagged its first live trading client within 6 months of launching.
Mr. Majed shares his ideas, vision and history with Forex Magnates, as we sit down over lunch in Limassol.
What’s your background and how did you enter the financial technology space?
I studied engineering at the University of Jordan. Consequently, I gained a lot of insight into the software side and went on to become certified in Oracle. During this period I started understanding how financial trading on the traditional floor trading pits was embracing the concept and reality of e-trading.
Why set up a trading platform?
Why a platform you ask (Akram smiles), I started seeing traction in banking and the world of trading during the 90’s and felt that the electronification of financial services is paramount; banks started to migrate branch-based systems, exchanges like NASDAQ and CME were spearheading the e-trading boom, and not to forget Reuters and EBS’s contribution, and hence we decided to compete in this market.
Tell us about the company and your business or work culture
The company is privately held, there are four directors including myself. We’re based in Amman. We have a number of technical and non-technical staff members, there are over 15 specialist developers and programmers who work on the platform on a full-time basis with another fifty working as contractors.
Our culture has always been one that looks beyond our immediate boundary to deliver clients useful products, my vision has always been for Hybrid Solutions to fill a gap or rectify a problem.
As a technologist, you quickly appreciate that your window of opportunity is limited, this is how we run our business, one of my eyes is reacting to client needs and the other is thinking of new ideas.
My team is an amazing pool of talent that contributes immensely to building the many blocks of Hybrid Solutions; during and after office time we have regular discussions that trigger talking points among the group. In addition, we even hold competitions whereby the staff designs useful and important tools to help us differentiate ourselves.
Tell us about the product and platform
Hybrid Solutions is the technology company and our signature product is the VertexFX trading platform. In short a full front-to-back trading platform for financial derivatives trading, the platform is a comprehensive closed-loop trading solution for providers.
Over the years we have built a number of core components that accompany the raw platform’s framework these include; back-end tools e.g (Dealing Desk, Bridging, API integration) this is combined with the Front-end related items e.g. (GUI, Desktop, Web Mobile, Scripting and API). Apart from the product side, we offer VertexFX ‘SaaS’ (Software as a Service). In addition, Hybrid Solutions addresses service through expertise and time of resolution, our team operates under strict SLA’s.
What about your clients? Who, what and where are they based? Volumes?
Since going live nine and a half years back we have gradually built a diverse user base. Our clients are broker-dealers, operating in the OTC and exchange traded markets. Additionally, we have carried out work with some exchanges integrating their core market data and execution functions to the platform.
If you ask me where our clients are from then its like the majority of brokers, we are a global outfit so naturally our portfolio is quite diverse, however our three main strong jurisdictions are; South Asia, mainland China & Hong Kong, the Middle East with Dubai being the core.
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I am afraid I am unable to provide volumetric data for confidentiality reasons.
I’ll also add, why do you think these markets have worked out for you?
It’s all about client demands and meeting their needs. I can’t dictate the profile of which location a client purchases our product from, but I can say that if you assess VertexFX from a holistic or macro perspective you will see that; the one-stop shop package means brokers of any size, experience and strategy can be easily accommodated.
I think clients in Asia are looking for such functionality hence the success of the trading platform. Pakistan is one of the biggest markets in the region and we have over 50 white label partners there, in total there are over 200 brokers in our network.
I am a developer not a salesperson, however after looking at the growing areas for retail FX, thanks to your news portal, I can see Asia and LATAM as the key growth areas. We have dipped our toes elsewhere, e.g. we have select clients in the UK and are keen to collaborate with more brokers in this region.
As I keep mentioning Adil, you should view VertexFX as a whole front-to-back solution but also in modular form, part of our growth strategy is working on isolated parts of the solution to integrate it with other vendors and providers, so naturally developed markets like Europe & Australia are part of the game plan.
What’s been your biggest challenge since inception?
There’s never one major challenge, however the media has played a critical role in giving coverage to certain platforms more then others. Aside from that, our biggest challenge is letting users know about the benefits of VertexFX, particularly when their minds have already been set.
On the software side, the main hurdles we face are to make sure the system never faces outage, there’s been instances of outage like with all technologies, however over a period of time we have done extensive work around ensuring the stability of our systems but also having the right back-ups.
Coming back to an earlier question, what’s next in terms of products? I know you have started adding a lot more to VertexFX, please share
There’s a lot to share, we have our own app store, Algo creating portal where developers and coders can pitch their ideas but also connect to traders who need development. Recently we have embarked on a trend common to our sector, that is the open concept, we offer a number of open-ended APIs which are FIX compliant and can be easily linked to; other venues, liquidity providers and traders.
We are seeing more and more client demand for new liquidity providers e.g pricing for CFDs, indices and equities, which pushes us to connect and cooperate with firms we have never had any contact with; this could be for CFD data, auto hedging to certain LPs or providers.
Where do you see the industry heading in 2015?
If you are referring to the current lack of volatility then this is just the cycle we are in, I’ve seen the Asian crisis, the Turkish banking crisis, the ‘dot com’ bubble, we are in a cycle. Markets are retracting but examine the overall BIS volume, yes I agree there is more and more recycling of liquidity, however I can see new participants entering who have recognized FX as an asset class for alpha generating strategies.
Retail market is driven on emotion and sentiment, it trades on its mood and volatility is low now, like the industry at large our brokers have been directly impacted, of course this is a concern for me but I am confident we can ride this out.
Any closing comments?
I think the recent cases, with one of the major players in the platform space has turned into a blessing in disguise, since last year our sales and new client on boarding process has been fast-tracked, our normal sales life-cycle easily crosses 150 days, however since the panic and uncertainty took place we have seen new clients of VertexFX appreciate the platform and they have definitely recognised VertexFX as a direct competitor in the retail FX platform market.
Trading platform are undergoing a major facelift that will have a major impact on the industry, the integration concept is all and well, however the amount of commissions need to be justified. For Hybrid Solutions it’s all about creating an accessible solution, we are open and welcome different providers to connect to VertexFX to give our clients a better trading experience.