Comment on TradeIt acquired. Any similar India opportunity?

Deepak Shenoy commented on 22 May 2019, 08:27 PM

Hi Nithin

I think there are two points:
a) Single API based access to trading across brokerages
b) regulatory hassle of exchanges saying trade origination should only be from broker software

Let me come to the second part first. Regulators need to be sure that people don’t come back to them and say look this trade happened without my knowledge – so any form of auto-trade will perhaps be regulated in India forever. But you could change this in some way in general – seamlessly allow customers to place or manage trades, once logged in. For instance, the Kite api allows us to open a browser with the basket pre-entered – this is done through javascript but it could as well be done with a URL itself (embedding the basket data as a parameter)

NOw a lot of trading is done via apps on teh mobile, but I don’t know (and don’t think) that brokers support a deep linking api access within a mobile app. You can do this inside of apps – for example, when you click an amazon link on yoru mobile, it will actually open theamazon app if you have it installed. You could have such a functionality to launch Kite (or a broker app) with information on the basket trade etc. and the app should detect and bring up a confirmation window for an ok.

For the first part, I believe Zerodha can play a big part in this. Eitehr define, or use a standardized API for trade execution, and push to standardize among brokers. This is effectively what is used by FIX, but FIX is inelegant and extremely painful to use. You could build a common protocol api that has to be implemented by every broker – and that becomes a standard for anyone else to build on. If one person then builds it for an omnesys backend and FT or even the NSE NOW, then it’ll work for a large number of users.

There are some existing standards, but each broker, even in the US has implemented in his own way: https://www.tdameritrade.com/api.page for example, or https://tradestation.github.io/api-docs/

Last part is data. Getting good data to create trades is also a pain in India. From adjusted stock prices (for bonuses/splits) to dividend history to financials to shareholding patterns. We have the data. But we don’t have a decent API access to it for a relatively low price, and I say API, not something like download a zip file that I have to redownload whenever data changes. People provide price data for a fee, but that’s the simplest part of it all – there’s so much more that can be provided and even used.

Look at https://iexcloud.io – that’s an exchange that gives data through APIs in the US. Quandl also has good data sets in the US.

Finally, there are test servers offered by NSE that provide replay of ticks all the time even weekends I think. If it’s possible to have sandboxes that place trades there to test and see how things would have worked, that will be cool. Or, if you have the data, build a sandbox that can test with past data replayed etc.

Lots of interesting things can be built here!

Cheers,
Deepak

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