October 17, 2018, Anya Aratovskaya (Advanced Markets) - Our marketing team gets countless emails from retail traders requesting demo versions of our FIX API.
Advanced Markets does not work directly with retail traders (the firm only deals with institutional clients), however, upon researching these requests further I came to the realization that this particular topic is not covered very well online.
Let’s say we have a retail trader, interested in trading via a FIX API, and who is looking for the broker that will be able to provide one.
The simple answer is that the average retail broker will not be able to provide a FIX API because they lack the technology infrastructure that would allow them to do so. FIX API technology is still considered the domain of institutional market players for several main reasons.
Reasons why FIX API is a prerogative of institutional market players
Reason #1: The provision of a FIX API requires a sophisticated system “back-end” and this type of technology is not available by default, even if a retail broker is already connected so some sort of aggregator. Only a limited number of enterprise level FX Solution Providers can successfully offer, and maintain, this robust FIX API infrastructure.
Reason #2: Even if a retail broker works with a technology provider that supports FIX API, support costs are adding up. The vast majority of technology providers don’t offer end user support, which means that the FX Broker must do it themselves. This will require additional “tech-savvy” staff to answer client questions.
Reason#3: Risk. Many FIX API traders are perceived as sophisticated or knowledgeable and, therefore, the probability of their being profitable is higher. A retail brokers will most likely need to be connected to at least one Liquidity Provider and have A book/STP available.
To conclude, a retail trader looking for a FIX API has probably outgrown the world of the average retail FX broker and is, instead, heading towards the more institutional space.
What does this mean for retail traders looking to step up to the FIX API?
1) Get ready to deposit at least USD 50,000 to initiate a live account.
2) Be prepared to pay a monthly minimum commission if certain volumes are not met.
3) Institutional Providers often can’t work with individuals -- a retail trader may need to form a company.
4) A GUI (Platform/Interface to place trades) is a must-have in order to view equity and floating positions in real time as well as to allow the ability to close/open positions in an emergency situation (mistakes in your code, for example).
5) A GUI is not offered by the majority of technical providers so be prepared to do some heavy, in-house, programming in order to gain access to your account metrics when required.
Hopefully the above information will help you in your search for the best solution for your FIX API needs.
If you want to get more information about how to trade with FIX API read our article Trading via FIX API.
If you have questions or comments regarding this topic, please contact us - We are always happy to help you!
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