Along with most of the industry, GAIN Capital’s Q3 earnings release revealed steep declines versus 2011 levels. Low levels of FX market volatility were cited as the main driver of the weakness in GAIN’s results. Highlighting the positive though, the broker made a point of emphasizing the future potential of its retail segment and growth taking place in its institutional unit. While currently dwarfed by its FOREX.com retail division, revenues in their institutional business, GTX, rose to $4.2 million from $1.4 million last year. In regards to the future, GAIN expressed optimism towards its recently launched TRADE platform as a source of increasing market share and trading volumes at FOREX.com. At the time, Glenn Stevens, CEO of GAIN Capital stated, “The launch of TRADE is an important step in a program to deliver a world-class FX and CFD trading experience for active traders that will include multiple new asset classes, unique ways to trade a wide range of global markets, and innovative ways to engage with the wider trading community through social and community tools.”
While new platform launches are common, what is unique about TRADE is that it is a CFD platform, whereas GAIN has traditionally focused on FX trading. TRADE is currently only available to clients outside the US, and was launched in the UK in late October and in Australia during November. As such, GAIN appears to be pinning its growth in its retail business outside of the US. Following up on the importance of the TRADE platform, Forex Magnates spoke to Muhammad Rasoul, CPO at GAIN for further information.
When asked why GAIN created a new platform when it already has a desktop, web-based, and mobile version of its proprietary FOREXTrader PRO platform, Rasoul explained that faster deployment of new tradable products and tools was key to the decision to invest in TRADE. The platform is designed to be a light weight browser based application rather than a downloadable platform. “Our FOREXTraderPRO platform is fully optimized for FX traders. Rather than try to adapt it to support a much wider range of CFD markets, we decided to adopt an entirely new technology platform that allows us to deploy new markets much more quickly.” TRADE offers around 250 CFD markets today, including FX pairs, commodities and indices, and Rasoul said the number of markets will double by early next year. According to Rasoul, another advantage of TRADE is that the front end is browser-based rather than a downloadable application, which “offers a lot of flexibility in terms of how clients access it, and allows us to more easily integrate new tools and resources into the platform.” He added that the TRADE platform offers a significantly expanded suite of CFDs, and GAIN views the product’s release as “just the start.”
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The TRADE platform also utilizes a different pricing model than FOREX.com’s traditional FX offering, as it uses fixed rather than variable spreads. Rasoul explained that this is part of GAIN’s approach “to not only be competitive in our CFD pricing, but also be very transparent so that our customers know exactly what they can expect in terms of both spreads and fills.“
Another interesting point is that GAIN is embracing the approach of recently launched Tradable platform, and will be working more with third party vendors to provide innovation for the TRADE platform, rather than rely solely on developing propriety technology . On this point, Rasoul explained “We are working with third party software providers, including a few that are new to financial markets and trading but have very interesting technology that we’re adapting for our customers, especially around social. We’re agnostic – if a third party is offering a best in breed tool, we want to be able to offer it to our customers. TRADE is an amalgam of different vendors that we are integrating into one experience.”
In regards to upcoming features for TRADE, while not revealing too many specifics, Rasoul hinted to a social trading product that would work across all of GAIN’s platforms, additional analytics tools, and a continued emphasis on mobile trading.