During our recent exhibition at iFX EXPO international in Cyprus in May 2019, we had a good time chatting with enthusiastic entrepreneurs looking to become a broker. We would like to share some of our thoughts on the opportunities on the white label.
The Foreign Exchange market (FX) has come a long way in the past 20 years. What was once the domain of banks and large investment firms is now open to the man in the street. Currencies afford investors unparalleled liquidity, 24-hour access to the market and the ability to make handsome gains. Over time, retail FX has grown up. Information is readily available to almost all market participants, tools that assist in money management are available as are trading strategies. As long as there is volatility, trade volumes tend to increase year on year providing business’ with constant returns.
Many would argue, that the enemy to this process has been regulation, or rather, over-regulation. We certainly have seen how EU brokers have dwindled as the regulators have imposed ever increasingly stringent requirements on brokers. Elsewhere, regulation has been more sensible and existing and new brokers are flourishing. The one drawback of regulation is that, in what was once a business you could start from home, now requires strategic planning and understanding of the regulatory environment and additional start-up capital.
Meta Quotes MT4 and MT5 afforded certain market participants the opportunity to form their own business in an easy manner and with the assistance of technology companies. By sourcing a white label solution from a technology partner, brokers are able to further reduce startup costs and defray operating costs by outsourcing to the technology partner.
Quick and easy to start:
All that is required is for the customer to select his liquidity choice, his parameters for trading and his preferred platform (FTT provides multiple solutions), and in as little as 1 week, the business is operational.
Low cost – good profit potential:
For a business that could return 7 figures in one year, the white label solution certainly seems a steal when one considered the startup cost from $5,000. Of course, the decision to regulate and incorporate a business is extra but even so, a well-run white label brokerage typically sees a profit in its first year.
Ability to manage and offset risk:
FX trading is risky. However, with Straight Through Processing (STP) that risk is substantially mitigated. STP is the direction most brokers are taking nowadays, but the ability to internalize the risk or a hybrid of the two remains should customers feel so compelled.
So many startup brokers start off well then require solutions that their technology partners can’t fulfill. This leads to patching the concerns which inevitably cause problems. The solution is to find a technology partner that can grow with you. From being a simple startup to becoming a large broker, FTT is able to walk step by step with you giving you the peace of mind that the solution is already available when you require it.
FX is….. Exciting:
A global game, limited barriers to entry, incredible profit potential, manageable risk, and a 24-hour market means that FX is an exciting place to be doing business.
Leave us a message if you want to know more about our white label offering.