INSIGHT
ROUND TABLE: THE
FUTURE OF FINANCIALS
Online binary and forex are currently experiencing a period of exponential growth and transformation
which far outstrips what’s being seen in iGaming. For a steer on where this is taking the sector and
how this will impact affiliates, iGB Affiliate canvassed Ophir Gertner of invest.com and Nicc Lewis of
Leverate for their expert predictions.
The infrastructure needed for tasks
such as high-frequency trading
means the FX and binary sector
has always pushed the boundaries
of tech and processing power.
What do you see as the next
transformative leap in this area,
and how will it impact the product,
its distribution and marketing?
Ophir Gertner (OG): Technology has
resulted in faster and more efficient
trading and I believe innovation in trading
is going to continue to expand rapidly
given high consumer demand. I think the
next leap is likely to be in automation
such as robo trading and robo advisers
with AI capabilities.
Nicc Lewis (NL): The key issue for brokers
has always started with their ability to
attract, convert and retain traders. There
are two massive factors at play today:
regulation and competition. There is also
a logical assumption that regulation is
feeding the increase in competition by
creating larger brokers with deeper pockets
and a need to generate larger volumes of
users. The outcome of all of this is that
brokers are saying that marketing costs
are going up while profit margins (due to
regulation) are going down. The flipside
is that regulation means access to wider
channels of marketing and mass media.
The only way to handle larger volumes of
interest while increasing ROI is automate
the conversion and retention funnels in a
smart way by using data, segmentation and
personalization which learns to optimize
the traffic on the fly. Mass media also
reaches mass segments, from the new
trader through to the more experienced,
so your offering/platform needs to cater
to all. In addition, wider markets mean
wider offerings of instruments and
payment methods. More instruments also
mean more liquidity and smarter risk
management. It is therefore clear that
[our management of] risk also needs to
automate and learn.
Belgium recently adopted a
hardline position against the
distribution of forex, binary and
CFDs. Is more of this kind of
regulation inevitable, or are there
steps industry stakeholders can
take to avoid following the path
of iGaming, of ban followed by
regulation?
OG: I believe that strong regulation is
welcomed by responsible trading providers.
The Belgian ban on leveraged trading was
a result of complaints by retail traders who
felt they were being aggressively and often
misleadingly targeted, and that at times
they were even victims of fraud. None
of us benefit from this type of behaviour,
and as long as it continues I anticipate
that more countries will adopt a hardline position. If the industry as a whole
embraces existing regulation and conducts
itself in a responsible manner then I think
this path can be avoided. We welcome
regulations which protect our customers
as well as us as a company. We hope that
in time Belgium will allow responsible
trading providers to once again give retail
traders the opportunity to trade selected
leveraged products.
NL: I believe that gaming gives us an
indication of the future of regulation in
financial trading. There is a clear time lag
between what has happened in gaming
and what is happening today in financial
trading, the difference being that the pace
of change in our sector is much faster
than it was in gaming. So let’s examine
Belgium from both the perspective of both
industries. Belgium has always been a bit
of maverick state. Their gaming laws are
clearly protectionist and not in line with
EU practice but they seem to be able to
navigate this. There seems to growing
“I think the next leap is likely to be in automation such
as robo trading and robo advisers with AI capabilities”
Ophir Gertner, invest.com
iGB Affiliate Issue 59 OCT/NOV 2016
35