Social Media Takes on Trading01.24.2018
In the next few years, trading may go the way of messaging and become yet one of the many functions of social media platforms.
TD Ameritrade has extended its social media capabilities further by adding access to market information and investor education materials to Amazon’s Alexa platform as well as a visual experience for Echo Show devices, according to Tim Hockey, CEO of TD Ameritrade during the firm’s fiscal first quarter conference call.
“This is a great enhancement levering artificial intelligence as powering a number of projects, including trading via a chatbot on Facebook’s Messenger app,” he said.
The brokerage launched its Facebook Messenger Chatbot, which lets users trade equities, and exchange-traded funds as well as deposit funds and access educational capabilities, in October 2017.
“I do not think people would have thought that possible a few years ago,” Hockey said at the time.
TD Ameritrade plans to continue identifying scalable ways to take its services and education direct-to-consumer, which will be a key focus of its innovation efforts.
“These technologies are transforming communication and commerce, and the role they can play in transforming investing is incredibly exciting,” he added.
Trading via social media seems to fit the growing trend of people seeking information from their peers as much or to a large extent from personal investment advisors, noted Richard Johnson, vice president, market structure and technology at analyst firm Greenwich Associates. “That probably is what you are going to see as millennials rely more on peers over professionals.”
Exactly how close the industry is to the convergence between social media and trading platforms varies, but experts agree it is a matter of “when,” and not “if.”
“There are platforms like Social Alpha and Stock Twits, and other online communities in which people can share investment advice,” Johnson added. “The next stage, of course, is tying it an online brokerage and that may already be happening.”
For Hockey, platform convergence has not started from his perspective.
“It is a bit of an opportunity to, if you will, parse out your offerings and, perhaps, have to invest in trading-as-a-service that becomes more available to clients on these social networks,” he said. “But it is early days.”
Increased volatility drives the buy side to take a closer look at how they are trading.
Flow to electronic trading platforms increased during the first half of 2022.
ADV was an average $1.1 trillion for the quarter, up 14% form the prior-year period.
The electronic fixed-income trading platform said it had a record number of active clients.
Electronic workflows enable market participants to streamline each step of the trading process.