Please tell us a little about the GO MARKETS background and its organisational structure?
GO Markets first started in the OTC derivatives sector in 2006, originally focusing on global share CFDs. The direction changed over the years, largely directed by consumer preferences with FX trading increasing in popularly in a post GFC environment. In 2008 we become the first provider to offer the Metatrader platform in Australia.
GO Markets Pty Ltd was incorporated in 1998 and has been operating under its current licence authorisations (permissions) since 2006. GO Markets holds an Australian Financial Services Licence (AFSL 254963) and is regulated by the Australian Securities and Investments Commission (ASIC). GO Markets is licensed to provide financial product advice in respect of derivatives, foreign exchange contracts and securities.
What are your own job responsibilities?
As the CEO, I’m responsible for the company’s overall direction and performance. From a day-to-day perspective, I’m generally engaged with the management team, and where possible I like to work directly with each business unit on certain projects. I’m also the responsible manager (RM) of our financial services licence. My central obligation here is to oversee the provision of financial services, in all respects. Regulatory compliance is a pet subject of mine, so I enjoy getting involved in some of the more mundane parts of running a financial services business.
What types of financial instruments can clients trade with you?
Margin FX, CFD indices, metals and energies. We’re in the final stages of integrating CFD shares and are aiming for a soft launch in the first quarter of 2019.
What sort of traders are you providing services for and where are they located?
We service both retail and wholesale clientele; but the majority are private retail traders. We’re positioned as a low-cost provider – probably one of the most competitive globally right now.
Given that we’re licensed in a well-reputed jurisdiction, we see clients from all over the world, with exception to some countries which may have specific licensing requirements, and/or subject to other regulatory restrictions.
Why are increasing numbers of traders choosing to use you and what do they like about the services you provide?
I think a polished exterior and good marketing are important but only go so far. Trust is a huge factor in our game and being a veteran of the industry helps. We’ve made conscious effort to maintain a solid culture of compliance – and I think it shines through.
What range of trading platforms do you offer?
MetaTrader 4 & 5, Webtrader and associated mobile device apps. We’ve also got a new mobile app coming in 2019.
Traders are often concerned about the quality of fulfillment. Could you outline your solutions and whether you offer pure STP fulfillment or do you pursue a hybrid model?
We rely on several different trade management techniques, so a hybrid model would be a reasonable way to put it. I do think we need to get past the old STP vs Market Making dichotomy though. Terms such STP (Straight Through Processing) and ECN are used perhaps a little haphazardly, and in my view are probably not going to show any real correlative value to better execution. Still, quality of execution/fulfilment, has never been more important. Regulatory reform and technology have helped this along somewhat over the last decade.
Many e-Forex readers like to develop their own trading strategies. What solutions do you provide to help traders build and back test their strategies?
Through the MT4 and MT5 platforms, traders are able to both create strategies using the MetaEditor and also back test their strategies using the Strategy Tester feature on MT4. This is especially useful for traders that use Expert Advisors, who can back test/optimize their strategy against years of data in only a few minutes. Traders may also wish to use their own testing facility or purpose-built technology.
The take up of MT5 vs MT4 was initially slow but appears to be speeding up now. We know that GO MARKETS was an early adopter of MT5. Do you see increasing interest in this platform?
It’s been years since we first released MT5. Clearly, at the time I think we all misread the traders’ willingness to make the switch, but these days we’re seeing much more of a natural move. Despite MT5’s superior features not excluding execution speed, there’s still some reluctance - given businesses have been built and matured on the MT4 technology – but it’s just a matter of time. MT5 is true multi-asset platform, this will surely help things along in the years ahead. The other factor is that new entrants will naturally gravitate to MT5. Given that many brokers are not yet offering MT5 and that off the shelf EA’s are now widely available for both platforms, we are proud to have been one of Metatrader 5’s early adopters.
How important is technology to your offering and how do ensure that your systems both secure and resilient?
Technology is key. And it’s not just the aesthetics – it’s the technology behind the scenes that drives client experience. We always ask ourselves how we can work more efficiently, and more generally how can we improve a client’s trading experience. Thankfully we’ve got a talented team handling the finer points of IT infrastructure – and much of the knowledge they’ve acquired is through hands-on, on-the-job experience.
GO Markets is one of the oldest and most established forex brokers. As well as being ASIC regulated, are there any plans to expand elsewhere?
Absolutely. We’ve just acquired a Cyprus-based provider, and are in the preliminary stages of getting our UAE presence up and running. We’ve got more exciting plans on the agenda for release in Q2 / Q3 of 2019!
What resources do you offer to help traders get more experience and to support their learning curves?
We’ve created two tailored education courses: ‘First Steps in Forex’ for beginner traders and ‘Next Steps in Forex’ for those at an intermediate level. These interactive courses have been designed to help teach not only the basics, but also support our more experienced traders through their trading journey. Apart from these educational courses we also have comprehensive training materials on our website which new and experienced traders can access at their leisure.
What steps have you been taking to launch new products and trading services?
While we’ve been able to get a few quick wins with the release of new indices, cryptos and other instruments, we’ve been extremely busy behind the scenes with our much-anticipated global share CFD release. We’ve put a lot of energy on getting the requisite exchange permissions and developing technology, and we’re almost there.
What institutional services do you provide for firms looking to partner with you?
We offer Liquidity and White Label services. Our institutional offering has naturally progressed over the years. More recently we’ve made a push for wholesale business, and partner with two of the leading technology/bridge providers. We anticipate doing more in 2019.
What are your expectations about how the retail FX trading market in Australia is likely to evolve over the next few years? Do you expect to see more consolidation amongst providers?
Locally, yes, I think we’ll see consolidation, but I don’t expect this to come in its traditional form (mergers and acquisitions). Australia is still going through a regulatory squeeze of sorts. We’ve had a few departures in 2018, and I think it’s reasonable to expect more. The barrier to entry is still very high in Australia in terms of licensing. The background backdrop of growing compliance costs and an increasing regulatory burden is encouraging consolidation in its various forms. From time to time there seems to be some overseas interest in consolidating the industry in Australia by M&A, but it’s a hard task. There need to be more than just economies of scale to make these successful.
ASIC Regulatory Benchmarks
As an OTC derivative provider GO Markets adheres to the seven disclosure benchmarks for over-the-counter contracts for difference that can help retail investors understand the risks associated with these products, assess their potential benefits and decide whether investment in the products is suitable for them.
How do you view recent regulatory changes in the MiFID zone? In particular the ESMA changes on retail client leverage.
It’s quite a change. Despite some of the great transparency initiatives, anecdotally it’s been net-negative for traders who may have ventured offshore to find the option of higher leverage they may want. Naturally, it’s a negative for the licensees in the Euro-region in my opinion. As an Australian licensee, we’re positioned to see some residual flow from the Euro-region, but on balance I think the bulk of the business is flowing offshore. This may not always impact clients negatively, but certainly it increases the risk of a net negative outcome in the long run.
What’s the keys to success in this business?
A solid product, brand and culture is probably a good place to start. Still, from my point of view timing and longevity are key elements. Timing is critical. I’ve seen some players enter with a solid product and still fail to launch – and some with a less than convincing set-up that have thrived. On the other hand, longevity invokes trust which I believe is critical in this game.
What’s the easiest way for traders interested in learning more to contact your team?