Should Technology Be An Expense ?
Technology cost is one of the major hurdles faced by newer or emerging Forex brokers. Its one of the main reasons why many start-up Forex brokers close their business within the first Two years of their business.
Given the variety of trading terminals available today, the need of a Forex trader is ever evolving and ever increasing. How effective these platforms really are ? its debate-able weather they help a trader to really become more profitable or not. However, one thing is for sure, that the exuberant costs of these platforms make a Forex broker less and less profitable while lack of these platform make a Forex broker incompetent.
So what do you choose to be, less profitable or less competent ?
Lets Analyze Your Costs
“Server” Cost or White Label “Set-Up” costs. This cost can vary between $5,000 to $150,000. Depending upon how large of a scale you need for your operations.
Irrespective of the size of your client base or volume, there is a minimum monthly cost for every platform your brokerage use. This cost can range between $1,000 to $10,000.
Data Feed Cost
The quality of data feeds can mean life or death for a Forex Broker. Imagine a scalper or a news trader taking advantage of your data feeds. A quality data feed can cost $2500 per month per platform.
While the minimum deposit that you have to maintain at a Liquidity Provider can range between $25,000 to $2,500,000. You still are expected to pay a minimum monthly cost to these liquidity providers. Liquidity providers charge a minimum to maintain a connection (called a “Bridge”) between you and the LP’s.
Weather its your Server hosting provider or your liquidity provider or your LP infrastructure provider. They all charge you a monthly processing that can range between $10 to $25 per million worth of transaction that happens on your platform.
SEO/SMO and Marketing
This is an expense that almost no online business can avoid in today’s market place. However, most important is how effectively and efficiently you use your online marketing tools to enhance your search engine ranking and social media branding.
Turnkey FX has revolutionized the concept of technology pricing for Forex Brokers. Our close knit relationships with various technology providers and liquidity providers ensure that we dont have to pass on any cost to the emerging Forex Brokers.