smartTrade Technologies won Best Multi-Asset Execution Management System (EMS) in the 2020 Markets Choice Awards.
Markets Media caught up with David Vincent, CEO at smartTrade, to learn more.
What is your reaction to smartTrade winning Best Multi-Asset EMS?
We are very proud to have received the award for the best Multi-Asset EMS from Markets Media.
Since inception, smartTrade made the decision to design the platform from the ground up to handle multiple asset classes – this has proven to be a very successful move and enables us to easily add new asset classes as the market evolves. This award and clients’ adoption of our EMS solution for multiple asset classes vindicates the design choice we made during smartTrade’s foundation.
Please describe what the product is all about — what are the primary capabilities and how does it differentiate?
SmartTrade’s EMS is the perfect response to trading firms looking for an innovative, robust and flexible technology trading platform offering more transparency, improved execution and a quick time to market. The platform comes with a state-of-the-art HTML5 user interface allowing clients to see liquidity, access internal or external algos as well as upload orders and monitor API order flow. Clients can also easily integrate our EMS with any 3rd party or in house OMS.
Our solution is attractive because it is a ready-to-use offering with a private and SOC2 certified hosted model, which means that customers do not need to involve significant internal IT resources in either the deployment or the daily operation of the platform.
What sets smartTrade apart is that we are a pure tech player, we do not get involved with liquidity – providing clean pass-thru prices, nor do we charge for brokerage. We stay neutral and transparent as buy-side firms have full ownership of the Liquidity Providers (LPs) relationship. All our solutions are based on a flat fee (vs. volume-based fee) model which enables clients to reduce and predict their trading costs while avoiding hidden costs and then resulting in higher profits.
What is the ‘story’ behind the company, i.e. what market gap was it designed to fill when it was founded back in 1999, and how has it evolved since then?
Harry Gozlan, co-founder of smartTrade, and I come from a banking background and that’s where we observed that the R&D, infrastructure and human resources costs involved to develop in-house trading technology were enormous. When we founded the company in 1999, we started from that observation and built our value proposition around the use of technology to make trading systems more efficient and cost effective. At that time, electronic trading was not as widely adopted as today. This is the idea behind smartTrade: allowing banks to outsource their trading technology to specialists providing the best technological trading tools, a solid infrastructure and an excellent service. We started by developing multi-asset trading engines for the sell-side and as the demand evolved towards more sophisticated trading models, we started developing additional systems catering for a wider audience, including the buy-side. Our multi-asset solutions provide connectivity to a wide range of liquidity providers/venues, aggregation, smart order routing, order management, pricing, distribution, risk management capabilities, a HTML5 user interface and big data analytics. The advantage of outsourcing technology is that vendors like us provide economies of scale which makes it possible to access the latest and best of breed technology for a significantly lower cost than developing it in-house.
What have been recent accomplishments / current initiatives at smartTrade?
Our EMS platform already supports Foreign Exchange, Fixed Income, Equities,Derivatives and Options. Our Fixed-Income buy-side clients are becoming more and more sophisticated and use our solution to increase their P&L. We assist them in this endeavour, through our price creation and market making workflows capabilities within the platform. In order for them to offer pricing they can leverage our connectivity to market data. Our clients are able to price and execute corporate and government bonds pricing. Last year, on clients demand we added Cryptocurrency and Money Market to the platform.
This flexibility in trading any asset class is a great advantage for our customers because it means that we can accompany them if they want to diversify their trading. Another initiative driven by client need is the large and flexible algos offering. With our solution, clients can either use built-in algos, create their own, ask us to write specific algos or integrate 3rd party algos. Our clients greatly appreciate that we provide many APIs, including REST, which enables them to control every aspect of the decision making process. Clients can use those APIs to create their own code to adjust their workflows, we do not get involved with liquidity – providing clean pass-thru prices, nor do we charge for brokerage.
How has smartTrade fared amid the extraordinary recent market conditions? Is the EMS more valuable amid high volatility?
We saw our clients volume double and in some cases even quadruple in March 2020 (compared to February) and in the high volatility context our platform was stable, reliable and performant. Relying on a robust and ultra-fast EMS to identify where liquidity lies and execute quickly is crucial, but that is not the only element to consider. Other value added elements can make the difference use of algos and analytics, and the ability to easily finetune it to be flexible and reactive to changing market conditions. smartAnalytics, our Big Data analytics system, is an excellent tool to track key indicators when dealing with high volumes. You can follow in real-time your trading performance with indicators such as volumes and fill rate, rejection analysis, last time viewed, rejection and degradation cost analysis reports, and performance indicators systems such as hardware, connectivity, latency, throughput, memory usage, etc.
Additionally, you also need to ensure that you have a proven infrastructure and a robust, resilient and scalable platform to cope with large volumes of data to ensure your business continuity. We have had excellent feedback from our customers on the solidity of our platform and have performed very well under these stressful conditions. Also with extraordinary market conditions some asset-classes might become illiquid and in addition to your EMS application, it is essential to partner with a technology vendor with a very large stack of connectivity in order to be able to connect to the right LPs very quickly.
What does the future hold for smartTrade?
One thing is certain, as people have to operate remotely, electronic trading is the key and could even be the only option for trading today. So we expect trading firms to assess their technology after this crisis, and if not already, make it their number one priority to have the best technology and infrastructure in place if similar challenges were to arise again. smartTrade’s goal is to continue to expand its large footprint in Europe, North America and Asia, and to grow in emerging and developing countries. We do see a dramatic opportunity to grow across the buy-side community and are continuously introducing new features to meet today and tomorrow’s requirements.